Production inefficiency is more likely to occur when the principal has more information about work performance than the agent does
Indicate whether the statement is true or false
False. It is when the agent has more information that production inefficiency is more likely to occur. The agent is able to shirk without being detected by the principal.
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In the case of an increase in government spending where the price level varies while the money wage is fixed, output
a. rises and prices fall by more than if the price level was fixed. b. falls and price rise by more than if the price level was fixed. c. rises by more and the price level rises by less than if the price level was fixed. d. and the price level are fixed. e. rises and prices fall by more than if the price level was fixed.
Which of the following would cause aggregate demand to shift to the right?
A. Increased income taxes B. Decreased corporate income taxes C. Decreased consumer confidence D. Decreased government spending
The major purpose of the Federal Reserve buying government securities in open market operations is to ________.
A. raise money for government spending B. reduce the excess reserves of banks C. allow banks to increase their lending D. increase interest rates
The United Kingdom dropped out of the ERM to avoid worsening a recession
Indicate whether the statement is true or false