Milton Friedman attributed the Great Depression primarily to
A) the government's failure to respond to an increase in the budget deficit.
B) a reduction in the money supply.
C) economists' and policy-makers' failure to acknowledge their limited knowledge.
D) the failure of wages to rise.
E) inaccurate expectations by consumers and firms.
B
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A chemical factory and a fishing club share a lake. Producing chemicals creates water pollution that harms the fish. The marginal social cost, private marginal cost, and marginal benefit from producing chemicals are in the figure above
Initially the lake is owned by no one. Keeping in mind the Coase theorem, if transactions costs are low then if the chemical factory owns the lake ________ tons of chemicals will be produced and if the fishing club owns the lake, ________ tons of chemicals will be produced. A) 4; 4 B) 4; 8 C) 8; 4 D) 8; 8
The notion that, following a devaluation, the BOT falls for a while before increasing is called a ________ effect
A) relative price B) elasticity C) J-curve D) pass-through
The Federal Reserve System functions as America's
a. tax collector. b. stock and bond market. c. savings bank. d. central bank.
If a good's price is volume sensitive, the consumer will:
A. choose the bundle on the budget line that lies on the lowest indifference curve. B. choose the bundle on the budget line where the budget line is "kinked." C. choose a boundary solution. D. choose the bundle on the budget line that lies on the highest indifference curve.