Describe some of the benefits and costs associated with the emergence of large cities in developing countries
What will be an ideal response?
Benefits include the ability to learn from others that are located in close proximity, a reduction in transportation costs, and a large availability of skilled labor. Costs include congestion and pollution.
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An increase in nominal GDP will
A. decrease the transactions demand and the total demand for money. B. decrease the transactions demand for money but increase the total demand for money. C. increase the transactions demand and the total demand for money. D. increase the transactions demand for money but decrease the total demand for money.
Suppose a national government increased its deficit and had to borrow $25 billion. The net effect on the banking system would be to:
a. Reduce bank reserves by $25 billion and reduce bank deposits by $25 billion. b. Increase bank reserves by $25 billion and increase bank deposits by $25 billion. c. Decrease government checking accounts in the banking system by $25 billion and increase the public's checking accounts there by $25 billion. d. Increase government checking accounts in the banking system by $25 billion and increase the public's checking accounts there by $25 billion. e. Increase government checking accounts in the banking system by $25 billion and reduce the public's checking accounts there by $25 billion.
Economics assumes that human behavior reflects "rational self-interest." This means they allocate their time, energy, and money to maximize their satisfaction.
a. true b. false
If the infant industry argument is used to protect an industry that has already matured, then
A. consumers lose because they will pay a price for a product that is above the world price. B. stockholders lose because the firm cannot compete with other firms. C. consumers lose because they will pay a price for a product, which is less than the world price. D. no one loses.