Economics is a social science that primarily explores how:
a. businesses market products under competitive conditions
b. stock and bond prices fluctuate when there are changes in demand or supply.
c. the government allocates its budget among competing political interests.
d. goods and services are consumed, produced and distributed in a world with limited resources.
d
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How is the production of public goods funded?
Resale price maintenance involves a firm
a. colluding with another firm to restrict output and raise prices. b. selling two individual products together for a single price rather than selling each product individually at separate prices. c. temporarily cutting the price of its product to drive a competitor out of the market. d. requiring that the firm reselling its product do so at a specified price.
Allen Steel Company is considering whether to build a new mill. If the interest rate rises,
a. the present value of the returns from the mill will fall, so Allen will be less likely to build the mill. b. the present value of the returns from the mill will fall, so Allen will be more likely to build the mill. c. the present value of the returns from the mill will rise, so Allen will be less likely to build the mill. d. the present value of the returns from the mill will rise, so Allen will be more likely to build the mill.
Suppose elasticity of demand is 1, elasticity of supply is 2, and a 5 percent excise tax is levied on consumers. Which of the following changes will reduce the burden of the tax on consumers?
A. Elasticity of demand falls to 0. B. Taxing authorities levy the tax on suppliers. C. Nothing will change the burden of the tax. D. Elasticity of demand rises to 2.