The self-correcting tendency of the economy means that rising inflation eventually eliminates:
A. unemployment.
B. exogenous spending.
C. recessionary gaps.
D. expansionary gaps.
Answer: D
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An analyst on a local news channel argues that the recent corporate scandals "demonstrated very clearly that self-interest always contradicts social interest." Do you agree or disagree? Substantiate your answer
What will be an ideal response?
If the funding for a larger budget deficit comes from international financial investors, then a budget deficit may be accompanied by a
a. trade surplus. b. trade deficit. c. trade balance. d. Ricardian equivalence.
Firms in an industry cannot earn long-run economic profits if:
A. production costs for a given level of output are minimized. B. there is free entry and exit of firms in the industry. C. the number of firms in the industry is fixed. D. fixed costs are zero.
Which of the following is an example for group price discrimination?
A) a BMW selling for more than a VW B) local residents receiving a discount at the local golf course C) the fact that a razor is cheap and blades are expensive D) a hotel charging more for a room if the customers bring pets