Attaining "allocative efficiency" means that:
A. The law of increasing opportunity costs has reached a maximum
B. The least costly methods are being used to produce a product
C. Resources are being devoted to the production of products most desired by society
D. The gap between marginal benefits and marginal costs of the product is biggest
Answer: C
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A legal minimum on the price at which a good can be sold is called a price
A. subsidy. B. floor. C. support. D. ceiling.
Alan Greenspan, former Chairman of the Federal Reserve, discussed the advantages of which kind of tax system, "particularly if one were designing a tax system from scratch"?
a. a progressive tax system b. a regressive tax system c. a consumption tax d. a lump-sum tax
What particularly important role do courts play in a market economy?
If the long-run Phillips curve is vertical, then any government policy designed to lower:
A. unemployment will not change the unemployment rate and only increase the inflation rate. B. unemployment will work leaving the inflation rate unchanged. C. inflation will cause employment to rise. D. unemployment will work causing the inflation rate to fall.