In larger markets, the quest for profit by firms motivates them to be innovative and produce new and more appealing products
Indicate whether the statement is true or false
TRUE
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With respect to CO2 emissions, low-income countries
a. do not contribute to the problem b. can expect to have "dirtier" industries as they develop c. contribute more per dollar of output than high-income countries d. will have to sacrifice output in order to reduce emissions e. none of the above
Price ceilings and minimum wages may increase poverty in the long run because they tend to
a. decrease the incentive to work among the poor b. increase the level of saving among the rich c. increase productivity of labor among the rich and poor d. promote investment among the rich e. reduce the distortions in the price system
When the Social Security system enters its deficit years and the bonds held in the trust fund are drawn down,
a. overall taxes will be reduced as the trust funds are used to pay benefits to retirees. b. the payroll taxes used to finance Social Security benefits can be reduced because the trust funds will be sufficient to pay the retirement benefits of the baby boom generation. c. taxes will have to be raised (or additional funds will have to be borrowed) in order to redeem the bonds held in the trust fund. d. income taxes will have to be reduced in order to keep the revenues and expenditures of the Social Security system in balance.
National income accountants compare the market value of the total outputs in various years rather than actual physical volumes of production because
What will be an ideal response?