In a market economy, who makes the decisions that guide most economic activity?
a. firms only
b. households only
c. firms and households
d. government
c
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According to your textbook, pollution is a major social and political concern because
A) it is inefficient. B) it is always immoral. C) people disagree about rights, which are extremely difficult to resolve. D) the environment is on the verge of ecological catastrophe.
If the cross elasticity of demand for good x with respect to the price of good y is positive, then goods x and y are
A) normal goods. B) inferior goods. C) complements. D) substitutes.
In the basic closed-economy ISLM model, the IS curve can be described by an equation where
A) output is a function of consumption. B) money is a function of interest rates. C) output is a function of money. D) output is a function of interest rates.
Usually the poorest fifth of the population in a developing country receives more than 20 percent of the country's income
a. True b. False