The achievement of the optimal allocation of society's scarce resources requires that regulators set prices equal to firms marginal cost
a. True
b. False
A
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The three broad reasons for saving, as identified by economists, relate to:
A. the life-cycle, precaution, and bequests. B. national, public, and private production. C. capital gains, capital losses, and deficits. D. consumption, investment, and exports.
Specialization leads to
a. increases in production because labor uses more advanced technology b. decreases in production because each resource becomes less productive c. increases in production because more resources are being used d. increases in production because each resource becomes more productive e. increases in production because capital is more productive than labor
Which of the following is NOT one of the programs through which the U.S. government attempts to redistribute income to the poor?
A. The Supplemental Nutrition Assistance Program (food stamps) B. Unemployment insurance C. Medicare D. The Works Progress Administration (WPA)
Suppose new research shows that soy products derived from soybeans provide more health benefits than previously thought. At the same time, drought conditions result in extensive damage to the soybean crop. What will be the combined impact of these two factors on the equilibrium price and quantity of soybeans?
A. Price will increase, but the effect on quantity is indeterminate. B. Price will decrease, but the effect on quantity is indeterminate. C. Quantity will increase, but the effect on price is indeterminate. D. Quantity will decrease, but the effect on price is indeterminate.