A policy in which the money supply is kept growing at a constant rate regardless of the state of the economy is
A) a Taylor rule.
B) a discretionary policy.
C) a policy rule advocated by monetarists.
D) advocated by activists.
C
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Diminishing marginal returns means that as you combine more units of a variable resource with a set of fixed resources:
a. the average physical product of the fixed inputs increases at an increasing rate. b. the marginal physical product of the variable input decreases. c. the total output decreases. d. the marginal physical product of the variable input increases at a constant rate. e. the marginal physical product of the variable input increases at a decreasing rate.
Use the graph below to answer the next question.
Other things equal, a decrease in the price of a substitute resource would cause a
A. move from a to b on D1. B. move from b to a on D1. C. shift from D3 to D2 assuming the output effect exceeds the substitution effect. D. shift from D2 to D3 assuming the output effect exceeds the substitution effect.
Indian exporters are concerned about trade diversion because _________ made an agreement with the ASEAN free-trade area.
a. India b. China c. the United States d. Mexico
Which statement is correct?
A. The operation of a market system eventually results in an equal distribution of income. B. Freedom of choice and enterprise are essential elements of the market system. C. Producers are "kings" in a market economy because they determine what is produced. D. The market system is efficient at allocation of resources but not in getting consumer goods to their most valued uses.