"Because the outputs of many industries are the inputs to other industries, the failure of any single industry to fulfill the output quantities specified in the central plan caused a chain reaction of adverse repercussions on production." This quotation
best identifies the:
A. incentive problem under central planning.
B. self-sufficiency dilemma under communism.
C. resource overcommitment problem under communism.
D. coordination problem under central planning.
Answer: D
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__________ trading volume promotes __________ bid-asked spreads
A) Large; wide B) Large; narrow C) Small; narrow D) None of the above.
If a nation has flexible exchange rates and its current and capital accounts equal zero, then the:
a. Financial account must be positive b. Financial account can be positive or negative depending on the size of the budget deficit and exchange rate. c. Reserves account can be positive or negative depending on the size of the budget deficit and exchange rate. d. Financial account minus the reserves account must equal zero.
In a cost-benefit analysis, the value of a human life is sometimes calculated on the basis of
a. the risks that a person voluntarily exposes herself to in her job and/or recreational choices. b. the value of each individual's assets. c. the belief that human life is priceless. d. the amount of resources required to adequately sustain life.
Collectives in the Soviet Union were inefficient producers of agricultural products. Why?
(A) The farms were too small to produce substantial crops. (B) Most farmers were poor and ad to pay for their own equipment, seeds, and fertilizer out of their own pockets. (C) Soviet central planners ignored the farms in favor of factories producing consumer goods. (D) Farm workers had guaranteed incomes, so they had few incentives to produce more or better crops.