If stock prices follow a random walk,
a. speculation in the stock market destabilizes prices.
b. a stock's past performance is not a good indicator of its future performance.
c. rumors, news, and other "signals" have no effect on stock prices.
d. the stock market does not participate in channeling resources toward firms with high stock prices.
b
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When a firm faces a labor supply curve that is upward sloping, the firm must
A) offer a higher wage if it wishes to hire more workers. B) pay a wage that exceeds the value of marginal product. C) pay a wage that does not exceed the minimum wage. D) maximize the amount of labor that it hires.
Why has the free-market system produced the most rapid rates of growth of any economic system?
What will be an ideal response?
The argument that trade generates gains for all workers may NOT be true because:
a. a more realistic assumption includes capital and land as factors of production and recognizes that trade will generate gains for some factors and losses for others. b. greedy corporations exploit workers. c. technology gains are concentrated among lowskill workers. d. some workers lack skills and training and cannot find jobs.
Which of the following is considered a key economic influence on the capacity of market economies to promote unprecedented growth?
A) political changes B) religious beliefs C) historical accidents D) free competition