Economists generally agree that price controls in the U.S. would
A. diminish the motivation to invent new drugs.
B. increase prices to consumers.
C. diminish the motivation to invent new drugs and diminish profits to drug companies.
D. diminish profits to drug companies.
Answer: C
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An increase in interest rates results in a(n) ________ in the required rate of return to hold stocks and ________ current stock prices.
A. decrease; reduces B. decrease; raises C. increase; reduces D. increase; raises
The process by which a quantity grows at a constant proportion in every time period is referred to as:
A) logarithmic growth. B) linear growth. C) vector growth. D) exponential growth.
If the nominal interest rate is greater than the real interest rate in an economy:
A) the real interest rate must be negative. B) inflation must be positive in the economy. C) inflation must be zero in the economy. D) inflation must be negative in the economy.
The price of peanuts drops from 50 cents to 25 cents per pound. How and why might an individual and a group of 1,000 people respond to this price drop very differently?
What will be an ideal response?