During a business cycle expansion, total production ________ and total employment ________
A) decreases; increases B) increases; increases
C) increases; decreases D) decreases; decreases
B
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A natural monopoly is a firm that owns a key natural resource
Indicate whether the statement is true or false
Adverse selection is caused by
a. Hidden actions b. Hidden information c. Both of the above d. None of the above
In the balance of payments, which of the following is TRUE of the sum of the capital account balance, the current account balance, and the official reserve transactions account balance?
A. This sum is positive only if the U.S. government operates with a budget deficit. B. This sum is either positive or negative, depending on whether the sum of all surplus and deficit items associated with cross-border transactions is positive or negative. C. This sum is positive only if the U.S. government operates with a budget surplus. D. This sum must always be zero, because the sum of all surplus and deficit items associated with cross-border transactions must equal zero.
An argument in favor of free trade is that trade barriers force consumers to pay higher prices for protected products than they would otherwise pay.
Answer the following statement true (T) or false (F)