When the government attempts to improve equality in an economy the result is often
a. an increase in overall output in the economy.
b. additional government revenue since overall income will increase.
c. a reduction in equality.
d. a reduction in efficiency.
d
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Long-run economic rent or profit do not exist for fixed factors like land because
A) bidding drives up the price of the factor until no economic rent exists. B) there is no market for such factors. C) these factors have L-shaped isoquants. D) these factors will earn economic profits.
Refer to the above figure. Which diagram shows the effect on the market of Corn Flakes when the price of Corn Flakes has increased?
A) graph C B) graph D C) neither graph D) both graphs
In an economy in which velocity is constant and real output grows at an average rate of 4 percent per year, a 4 percent average rate of growth in the money supply would result in: a. a constant price level
b. a slowly increasing price level. c. a rapidly increasing price level. d. constant real GDP. e. constant nominal GDP.
The diversion of surplus labor in agriculture to the production of schools or roads in developing countries is described as:
A. Land reform B. The brain drain C. In-kind investment D. A capital-using technological advance