Under laissez faire, the allocation of scarce resources among the different industries
a. is possible only with government tax and subsidy policies.
b. is accomplished by the price system.
c. requires a considerable amount of central planning.
d. is the result of consumer planning.
b
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Persuasive advertising influences demand by:
A. altering the underlying tastes of consumers. B. providing information about the availability of a product. C. offering reduced prices for the product. D. none of the statements are correct.
If the quantity demanded for a good rises as the price falls, the curve representing this relationship will be:
A. horizontal. B. upward-sloping. C. downward-sloping. D. impossible to determine.
Inflation is often accompanied by
a. seigniorage b. forced saving c. financial repression d. large government budget deficits e. all of the above
What happens to aggregate demand when government spending and the taxes to pay for it both rise by the same amount?
A. There is no effect. B. Aggregate demand rises by the amount of the government spending times the multiplier. C. Aggregate demand rises by the amount of the government spending. D. Aggregate demand falls by the amount of the government spending.