Fire protection and police protection may be provided more efficiently by the private sector than by the public sector.
Answer the following statement true (T) or false (F)
False
Fire and police protection are public goods; therefore, the private sector will underproduce these services.
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The fact that output gaps will not last indefinitely, but will be closed by rising or falling inflation is the economy's:
A. income-expenditure multiplier. B. self-correcting property. C. short-run equilibrium property. D. long-run equilibrium property.
Which of the following statements is false?
A. The issuer of a bond is a borrower. B. The person who buys a bond is a lender. C. Interest earned on corporate bonds is exempt from federal income taxes. D. The coupon rate on a bond is the percentage of the face value that the bondholder receives annually until the bond matures.
Incentives are
A) potential rewards available if a particular activity is undertaken. B) ineffective as a device to get people to behave in a certain fashion. C) inappropriate ways to obtain a certain kind of behavior. D) useless when people behave rationally.
A modern economy has millions of goods and services whose prices are continually increasing and decreasing based on supply and demand.
Select whether the statement is true or false. A. True B. False