Price floors set a legal minimum price on a product or commodity.
Answer the following statement true (T) or false (F)
True
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The majority of transactions in foreign exchange markets involve ________
A) transactions one the New York Stock Exchange B) exchanging one set of physical notes for another C) exchanging bank deposits denominated in different currencies D) buying and selling Treasury securities
If a price floor is set below the current market clearing price, then
A) a surplus must immediately occur. B) a shortage must immediately occur. C) there will be incentives for black markets to develop. D) quantity demanded will remain equal to quantity supplied at the current market clearing price.
Suppose there is a reduction in the saving rate. This decrease in the saving rate will cause a reduction in which of the following once the economy reaches its new steady state equilibrium?
A) growth rate of output B) growth rate of capital C) growth rate of capital per worker D) all of the above E) none of the above
An advantage of a partnership over a proprietorship is
A. that profits are not taxed twice. B. the ability to take advantage of greater specialization. C. limited liability. D. that it is easier to dissolve.