Money serves as a basic yardstick for measuring economic value (a unit of account), allowing:
A. governments to restrict the issuance of private monies.
B. people to hold their wealth in a liquid form.
C. easy comparison of the relative prices of goods and services.
D. goods and services to be exchanged with a double coincidence of wants.
Answer: C
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Did Mother Teresa create positive externalities when she helped the poor of Calcutta?
A) No, because the poor continued to exist and her efforts were largely unsuccessful. B) No, because she fully calculated all the benefits of her activities. C) Yes, because her activities have inspired and benefited countless others whom Mother Teresa could not have known about or taken into account. D) Yes, because her activities had nothing to do with the search for economic profit.
The Coase Theorem implies that when there are no costs to trading, _____
a. resources will move to their most valued uses, depending upon who gets the initial property rights b. resources will move to their most valued uses, regardless of who gets the initial property rights c. resources might be misallocated, depending upon the who gets the initial property rights d. resources might be misallocated, regardless of who gets the initial property rights
Which of the following is not correct?
a. When a union is present in a labor market, wages are determined by the equilibrium of supply and demand. b. Like any cartel, a union is a group of sellers acting together in the hope of exerting their joint market power. c. The process by which unions and firms agree on the terms of employment is called collective bargaining. d. Most workers in the U.S. economy are not members of a union.
You hear someone claim that stocks are less risky than bonds. What possible evidence could this person offer for such a claim?
What will be an ideal response?