Positive economic principles are those that:
A. predict how people will behave.
B. are influenced by political ideology.
C. are always correct.
D. indicate how people should behave.
Answer: A
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The figure above shows the U.S. demand and U.S. supply curves for cherries. At a world price of $2 per pound, the total imports of cherries to the United States from other nations equals
A) 200,000 pounds. B) 400,000 pounds. C) 600,000 pounds. D) 800,000 pounds. E) 0 pounds.
Under the Sarbanes-Oxley Act of 2002, the clause that makes it unlawful for a registered public accounting firm to provide any nonaudit service to a client contemporaneously with an impermissible audit is an example of which remedy of conflicts of
interest? A) regulate for transparency B) supervisory oversight C) separation of functions D) socialization of information production
Which of the following is not a criticism of monopolies?
a. They restrict output. b. They set price above the perfectly competitive level. c. They tend to be less innovative than firms in a competitive market. d. They exert a disproportionate amount of political influence. e. They reduce allocative efficiency through perfect price discrimination.
As the marginal propensity to consume (MPC) increases, the spending multiplier
a. increases. b. decreases. c. remains constant. d. becomes indefinable.