Does voluntary exchange create wealth (value)?
What will be an ideal response?
Yes, trade generally permits the trading partners to gain more of what they value; this is why they agree to the terms of the exchange.
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Banking regulation in the United States is strongly influenced by the large amount of __________ deposits and __________ assets banks hold
A) time; illiquid B) time; liquid C) checkable; illiquid D) checkable; liquid
Clothing retailers have faced greater competition in recent years as more firms have entered the clothing market. Some of the competition has come from foreign competitors, but much of it is domestic competition
As a result there is much competition in markets for many types of clothing and A) individual buyers and sellers cannot affect the market price because it is determined by the market forces of demand and supply. B) there are no other implications. C) firms have a great degree of flexibility in pricing their products because these products can be sold at a high profit level. D) there are relatively few buyers and sellers in the market, and one individual firm can determine the market price.
When Marietta chooses to only purchase a combination of goods that lie within her budget line, she:
A. is decreasing utility. B. likely has negative savings. C. must reduce the quantity. D. is maximizing utility.
Interest sensitive consumption is negatively impacted by interest rates because when you
A. pay cash for something, the price you really pay depends on the interest rate. B. buy something on installments (like a car), your payments are positively related to the interest rate, so a higher interest rate would mean a higher payment, and therefore, less interest sensitive consumption. C. buy something you really need, the price you really pay depends on the interest rate. D. buy something on installments (like a car), your payments are negatively related to the interest rate, so a higher interest rate would mean a higher payment, and therefore, less interest sensitive consumption.