Which of the following would NOT be included in consumption expenditures when calculating GDP?
A. an individual's purchase of medical services
B. an individual's purchase of newly issued shares of IBM stock
C. an individual's purchase of a new car
D. an individual's purchase of legal services
Answer: B
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The interest rate is the price borrowers pay to borrow money. Key interest rates are controlled by the Federal Reserve System. If the Federal Reserve acts to reduce interest rates, economists would expect the quantity of money supplied to
A. increase. B. decrease. C. not change. D. Uncertain-economic theory has no answer to this question.
Government typically solves the free-rider problem by using its
A) ability to print money. B) power of eminent domain. C) ability to borrow money from the Federal Reserve. D) power of taxation.
In a market economy, prices help determine the distribution of goods and services but not the allocation of resources
a. True b. False Indicate whether the statement is true or false
An incentive for managers to maximize profits is:
A. performance bonuses. B. reputation. C. takeovers. D. All of the statements associated with this question are correct.