When the government prohibits certain kinds of market behavior such as monopoly and monopolistic practices it generally does so through
A) regulatory agencies such as the Interstate Commerce Commission or the Federal Communications Commission.
B) antitrust law.
C) the police powers of the states.
D) use of the capture theory of regulation.
B
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If the consumer's income increases while the prices of both goods remain unchanged, what will happen to the budget line?
A) The budget line rotates inward from the intercept on the horizontal axis. B) The budget line rotates outward from the intercept on the vertical axis. C) The budget line shifts inward without a change in slope. D) The budget line shifts outward without a change in slope.
Since classical economists and monetarists believe that the economy operates at full employment, real GDP, that is, along the vertical segment of aggregate supply:
a. any increase in the money supply can only end up raising the price level. b. any increase in the money supply can only end up lowering the price level. c. any decrease in the money supply can only end up raising the price level. d. changes in the money supply will not affect the price level. e. any increase in the money supply will cause both nominal and real GDP to increase.