Which of the following is true?
A) Changes in personal costs and benefits will exert a predictable influence on the choices of people.
B) If the intentions behind a policy are good, you can be assured that the outcome will be desirable.
C) If a good is provided free to an individual by government, its production will not consume valuable scarce resources.
D) If one individual gains from an economic activity, then someone else must lose.
A) Changes in personal costs and benefits will exert a predictable influence on the choices of people.
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Refer to the figure above. What is the domestic demand for pens in Lithasia, after the economy opens up to free trade?
A) 6 units B) 12 units C) 16 units D) 22 units
People view alcohol and marijuana as perfect substitutes. This means that
A) individuals will consume either alcohol or marijuana, but not both, regardless of price. B) as the price of alcohol decreases, marijuana use decreases. C) the marginal utility for alcohol and marijuana is constant. D) Both B and C.
Which of the following about fiscal policy is true?
a. Modern forecasting methods make it relatively easy to time fiscal policy changes in a manner that will help stabilize the economy. b. Legislative action is necessary if automatic stabilizers are going to smooth the ups and downs of the business cycle. c. Proper timing of changes in discretionary fiscal policy is both crucially important and difficult to achieve. d. Both the crowding-out and new classical theories indicate that expansionary fiscal policy will exert a powerful impact on aggregate demand.
The costs involved with breaking a ban placed on a good depend on all of these except the:
A. likelihood of being punished if caught. B. punishment associated with rule breaking. C. ability of the public or individuals to pay for those costs. D. likelihood of being caught.