According to some economists, the private sector is more efficient than the public sector mainly because:

Bill's Lawn service starts the year with 20 lawn mowers. During the year, 3 mowers break and are not worth fixing. Bill also expands his business and buys 10 more mowers. Bill's net investment is ________ mowers

A) 13 B) 7 C) 10 D) 20 E) 27

What do most economists think is the most accurate statement about velocity?

A. Velocity is fairly constant in the short run but varies considerably in the long run, complicating predictions about nominal GDP. B. M1 velocity is more stable in the short run than M2 velocity, and it has been a superior tool in predicting changes in nominal GDP. C. Velocity is not constant in the short run, and predictions about nominal GDP have not fared well. D. M2 velocity has been less stable than M1 velocity, but both are reliable enough to make accurate predictions about changes in nominal GDP.

The presence of discouraged workers:

A. increases the size of the labor force but does not affect the unemployment rate. B. reduces the size of the labor force but does not affect the unemployment rate. C. may cause the official unemployment rate to understate the true amount of unemployment. D. may cause the official unemployment rate to overstate the true amount of unemployment.

The practice of buying a firm's good in one market at a low price and selling it in another market for a higher price in order to profit from the price difference is known as

a. Predatory pricing b. Price collusion c. Arbitrage d. Mark-up pricing