The tools, instruments, machines, and buildings that people use to produce goods and services are called human capital
Indicate whether the statement is true or false
FALSE
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Suppose the Fed buys $1 million of government securities from Bank One, a large commercial bank. Bank One's reserves ________ and its deposits ________
A) increase by $1 million; do not change B) increase by $1 million; increase by $1 million C) do not change; increase by $1 million D) do not change; do not change E) decrease by $1 million; do not change
Economists believe the most persuasive argument for protectionism is to protect infant industries. But the argument has a drawback. What is this drawback?
A) Governments are usually too impatient and do not allow protection to remain in place long enough to allow industries to be competitive in international markets. B) Protection lessens the need for firms to become productive enough to compete with foreign firms; this often results in infant industries never "growing up." C) Governments usually use tariffs, rather than quotas, to protect infant industries in order to collect tariff revenue. (Quotas do not result in government revenue). D) Governments always make the level of protection for infant industries too high.
A perfectly competitive firm is hiring variable resources M and N. It will minimize total costs
A) MRPm/MFCm = MRPn/MFCn. B) MRPm ? MFCm = MRPn ? MFCn. C) Pm/MPPm = Pn/MPPn. D) MPPm/Pm = MPPn/Pn.
The Coase theorem implies that an efficient solution is possible only if property rights are well-defined and transactions costs are low
a. True b. False Indicate whether the statement is true or false