A price support on agricultural products is a minimum domestic price set by the government. The government outlaws transactions below the price support, but usually has no commitment to buy any amounts that farmers cannot sell at this price.
Answer the following statement true (T) or false (F)
False
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Economic agents have an incentive to formulate expectations rationally
A) because ignoring information is usually costly. B) to increase prices. C) to reduce wages. D) to ensure that all expectations are realized.
One reason for the differences between the Federal Reserve System and its European counterparts is
a. that the Fed was established earlier b. the tendency for Americans to embrace the idea of a central authority c. the fear that a powerful central bank might be dominated by one group's interests to another group's detriment d. the homogeneity of the United States compared with other nations e. because our definition of money is much different from other countries
When the chairman of the Federal Reserve announced a goal of "zero inflation," which of the following economic policies was most likely being changed?
A. Supply-side policy. B. Monetary policy. C. Fiscal policy. D. Congressional policy.
The diagram suggests that:
A. X and Y are both inferior goods.
B. X and Y are both normal goods.
C. X and Y are substitute goods.
D. X and Y are independent goods.