The government of a DVC may force the economy to save by deliberately causing inflation. This policy is undesirable because inflation may:
A. distort investment away from productive facilities and toward luxury housing and precious
metals.
B. increase voluntary saving because the value of money is depreciating.
C. contribute to a balance of trade surplus.
D. entail all of these problems.
A. distort investment away from productive facilities and toward luxury housing and precious
metals.
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If the Chinese government sets a price ceiling below the equilibrium price, the result will be I. an increase in the quantity demanded. II. a decrease in the quantity supplied. III. a shortage
A) I only B) I and II only C) III only D) I, II, and III
Assume two nations are involved in an arms race. They both assume that each faces two choices – sign disarmament accord or continue with military expansion and the building of more nuclear missiles
Explain using the prisoner's dilemma model why both of these nations will choose to escalate the arms race rather than choose bilateral disarmament. During the Cold War President Ronald Reagan was quoted as saying that the United States will "trust, but verify" when discussing nuclear nonproliferation agreements between the U.S. and the Soviet Union. How does this relate to your answer to the first part of this question?
Which of the following is an example of market failure?
a. Public goods. b. Externalities. c. Lack of competition. d. all of these.
If net taxes decrease, which of the following would occur?
a. Disposable income decreases, consumption at any income level increases, and the consumption-income line shifts upward. b. Disposable income increases, consumption at any income level increases, and the consumption-income line shifts downward. c. Disposable income increases, consumption at any income level increases, and the consumption-income line shifts upward. d. Disposable income decreases, consumption at any income level decreases, and the consumption-income line shifts downward. e. Disposable income increases, consumption at any income level decreases, and the consumption-income line shifts downward.