Only a market economy must answer the questions of what goods to produce, how to produce them, and for whom to produce them.
Answer the following statement true (T) or false (F)
False
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Privatizing a commons gives the person who owns it an incentive to
A) exploit the resource until it is depleted. B) restrict it from being used at all. C) manage it carefully. D) make it available to everyone without restriction.
In the very long run, the level of consumption per worker can grow continually if
A) the saving rate continually falls. B) the population growth rate continually rises. C) productivity continually improves. D) the depreciation rate continually rises.
________ in the domestic interest rate causes the demand for domestic assets to shift to the left and the domestic currency to ________, everything else held constant
A) An increase; appreciate B) An increase; depreciate C) A decrease; appreciate D) A decrease; depreciate
Which of the following statements is correct?
a. A decrease in the size of a tax always decreases the tax revenue raised by that tax. b. A decrease in the size of a tax always decreases the deadweight loss of that tax. c. Tax revenue decreases when there is a small decrease in the tax rate and the economy is on the downward-sloping part of the Laffer curve. d. An increase in the size of a tax leads to an increase in the deadweight loss of the tax only if the economy is on the upward-sloping part of the Laffer curve.