Which of the following is the oldest economic system?
a. command economy
b. traditional economy
c. market economy
d. underground economy
b. traditional economy
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Evidence of external costs in the production of a product is present if
A) the price of the product is higher than it should be. B) the production cost increases because of an increase in the minimum wage. C) non-buyers and/or non-producers of the product experience a loss for which they are not compensated. D) buyers refuse to purchase the product. E) producers pay all of the costs of producing the good or service.
A budget line is a straight line designed to show
A. how income is related to hours worked. B. all combinations of two goods that can be purchased with a given income. C. the way a homemaker should divide money among several commodities. D. that if more money is spent on one good, the breadwinner must work all the harder to maintain a satisfactory level of living. E. preferences for goods and services.
Which of the following is a necessary characteristic of a public good? The good is
A) excludable. B) nonrival. C) nonexcludable. D) Both answers B and C are correct.
If an economy's population grows at 3 percent and GDP grows at 4 percent, then:
a. per capita real GDP is declining. b. the economy's standard of living is decreasing. c. per capita real GDP is negative. d. per capita real GDP is growing. e. the economy is experiencing unemployment.