In an economy in which decisions are guided by prices and individual self-interest, there is
a. the potential to achieve efficiency in production.
b. a strong need for government intervention in the market.
c. less efficiency than would be observed in a centrally-planned economy.
d. more need for a strong legal system to control individual greed than would be needed in a centrally-planned economy.
a
You might also like to view...
Suppose the federal government is successful in reducing the budget deficit, households decide to increase their saving, corporate taxes are reduced, and businesses expect to see an increase in future profits
Use the loanable funds model to explain how each of these events affects the demand and supply of loanable funds and illustrate your answer with a graph. Describe what should happen to the equilibrium real interest rate and the equilibrium levels of saving and investment?
The present value of the future is
A) not related to the interest rate. B) inversely related to the interest rate. C) positively related to the interest rate. D) equal to economic profit
If the reserve ratio is .20, the money multiplier can be as high as
A. 20. B. 10. C. 5. D. 50.
In which of the following ways is a monopolistically competitive firm like a perfectly competitive firm?
A. Short-run economic profits are always positive. B. Long-run economic profits are negative. C. Long-run economic profits are positive. D. Long-run economic profits are equal to zero.