The text suggests that if economists had a mantra, it would be:
A. justice is the measure of all things.
B. trade is good.
C. when one person benefits, another is hurt.
D. do unto others before they do unto you.
Answer: B
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According to Ricardian Equivalence, crowding-out ________
A) is incomplete B) will raise the level of domestic income C) is complete D) does not play a role in influencing private investment levels
If a nation is going to achieve and sustain a high rate of economic growth, it must
a. prohibit low-wage foreign producers from supplying goods to the domestic market. b. have an abundant domestic supply of low cost energy resources. c. have a mechanism capable of attracting savings and channeling them into wealth-creating projects. d. impose regulations that will limit the intensity of competition among domestic firms.
With average cost pricing, the monopolist
A) earns no accounting profit. B) produces where P = MC. C) earns a normal rate of return for its shareholders. D) does not cover opportunity costs.
Italy should specialize in the production of
A. neither good and import both goods. B. cars and import boats. C. both goods and import neither good. D. boats and import cars.