Monopolists may in the long run
A. earn positive economic profit.
B. be protected by barriers to entry.
C. grow wealthy at the expense of their consumers.
D. All of these responses are correct.
Answer: D
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What is one problem with using a Clarke tax to finance government provision of a public good?
a. People tend to overstate their preferences for the public good when a Clarke tax is imposed. b. The government may decide against providing the public good, even when it would be efficient to do so. c. The Clarke tax is not a fair tax, because everyone pays the same amount regardless of income. d. The revenues collected from the Clarke tax may not cover the cost of the public good.
A decrease in a country's capital stock occurs when ________.
A. businesses sell machinery and equipment to one another B. the consumption of fixed capital exceeds gross domestic investment C. the prices of investment goods rise faster than the prices of consumer goods D. businesses have larger inventories at the end of the year than they had at the start
The required reserve ratio is 10 percent, and the potential change in demand deposits is $100 million. What are original excess reserves?
A) $10 million B) $100 million C) $1 million D) $1 billion
Investment from abroad
a. is a way for poor countries to learn the state-of-the-art technologies developed and used in richer countries. b. is viewed by economists as a way to increase growth. c. often requires removing restrictions that governments have imposed on foreign ownership of domestic capital. d. All of the above are correct.