Free entry means that
a. the government pays any entry costs for individual firms.
b. government-funded research lowers the costs of patents and other barriers to entry.
c. a firm's marginal cost is zero.
d. no legal barriers prevent a firm from entering an industry.
d
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Recent proposals to allow the Social Security trust fund to invest in the stock market (instead of buying government bonds) are based on the premise that
A) the returns to stocks are higher than the returns to bonds. B) the returns to stocks aren't as risky as the returns to bonds. C) the transactions costs for investing in stocks are lower than the transactions costs for investing in bonds. D) stocks are more liquid than bonds.
According to the Ricardian equivalence proposition, current deficits
A) will not affect consumption or national saving. B) will affect consumption but not national saving. C) will affect national saving but not consumption. D) will affect both consumption and national saving.