Which statement about allocative efficiency is true?
a. Allocative efficiency requires productive efficiency.
b. Productive efficiency leads to allocative efficiency.
c. Allocative efficiency is profitable but wasteful.
d. Allocative efficiency benefits firms but not society.
a. Allocative efficiency requires productive efficiency.
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Cost-push inflation is caused by a leftward shift of the aggregate demand curve
a. True b. False Indicate whether the statement is true or false
Which of the following probably best explains why trade restrictions are imposed even if the costs to consumers are greater than the benefits to protected industries?
a. Indifference on the government's part to the interests of domestic workers b. A desire to make other countries suffer c. Successful lobbying by consumers d. Successful lobbying by employers and workers e. The government's preference to safeguard the interest of the producers at the expense of the consumers
The best hope for continued growth of the U.S. economy probably lies in:
a. a return of manufacturing to the U.S. b. innovation c. patents d. decreasing poverty
According to liquidity preference theory,
a. an increase in the interest rate reduces the quantity of money demanded. This is shown as a movement along the money-demand curve. An increase in the price level shifts money demand to the right. b. an increase in the interest rate increases the quantity of money demanded. This is shown as a movement along the money-demand curve. An increase in the price level shifts money demand leftward. c. an increase in the price level reduces the quantity of money demanded. This is shown as a movement along the money-demand curve. An increase in the interest rate shifts money demand rightward. d. an increase in the price level increases the quantity of money demanded. This is shown as a movement along the money-demand curve. An increase in the interest rate shifts money demand leftward.