The case for advertising includes the fact that
A. it wastes society's scarce resources.
B. firms spend large sums of money to create meaningless differences among products.
C. it creates wants that otherwise would not have existed.
D. it provides consumers with valuable information about product availability, quality, and price.
Answer: D
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If the price of Sea World tickets increased what might we expect to see happen to tickets for Disneyland?
A. Decreased supply of Disneyland tickets B. Increased demand for Disneyland tickets C. Decreased demand for Disneyland tickets D. Increased supply of Disneyland tickets
A problem with the use of aggregate demand management to stabilize the business cycle is that
A) monetary policy isn't available to use when interest rates are already rising because of higher inflation. B) fiscal policy takes a long time to have any impact on the economy. C) monetary policy is difficult to use, because the decision-making process is long and complicated. D) the precise amount that output will change in response to monetary or fiscal policy isn't known.
In a market where the equilibrium price is $7, any price higher than $7 would cause
a. a balanced demand and supply b. an excess supply c. an excess demand d. none of the above
Starting from long-run equilibrium, a war that raises government purchases results in ________ output in the short run and ________ output in the long run.
A. lower; potential B. higher; potential C. higher; higher D. lower; higher