Which of the following most accurately states the economic significance of exchange?
a. Physical goods have value because they exist; exchange can neither increase nor decrease their value.
b. Production of physical goods creates value; exchange merely redistributes this value.
c. Exchange creates value by moving goods from parties who value them less to parties who value them more.
d. Exchange reduces value since it consumes resources without adding to the physical supply of goods.
C
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Because new plastic and recycled plastic are substitutes, as the price of newly produced plastic decreases
A) the demand curve for recycled plastic shifts to the left. B) there is a movement up along the demand curve for recycled plastic. C) there is a movement down along the demand curve for recycled plastic. D) the demand curve for recycled plastic shifts to the right.
Tax loopholes serve to
a. improve the incomes of the poor. b. erode the progressivity of the income tax. c. increase the progressivity of the income tax. d. decrease work incentives for the poor.