The idea that the desires of resource suppliers and producers to further their own self-interest will automatically further the public interest is known as:
a. Profit maximization
b. Derived demand
c. Consumer sovereignty
d. The invisible hand
d. The invisible hand
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All else equal, if Canada raises its interest rates,
A) the dollar depreciates. B) the U.S. demand for Canadian dollars increases. C) the Canadian supply of Canadian dollars increases. D) Both A and B. E) Both A and C.
Real estate is property, which can be either a tangible or an intangible asset. Which of the following would be considered an intangible asset?
A. Land B. Building C. Mortgage D. Fence
The Fed tried to reduce unemployment in the years following the recession of 2001 by:
A. reducing the growth rate of the money supply. B. increasing government spending on construction projects. C. keeping the Federal funds rate very low. D. raising the reserve requirement for banks.
When prices rise, consumers and businesses hold larger money balances. This reduces the supply of loanable funds, increases the interest rate, and discourages both consumption and investment. This process is called the:
a. interest-rate effect. b. real balance effect. c. investment effect. d. disinvestment effect.