An economic policy is:
A. a generalization about the workings of an abstract economy.
B. a physical or mental structure that significantly influences economic decisions.
C. a standard people use when they determine whether a particular activity or behavior is acceptable.
D. an action taken by the government to influence the course of economic events.
Answer: D
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A production possibilities curve that is a straight line represents the case of
A) constant costs. B) increasing costs. C) decreasing costs. D) constant opportunity costs but increasing real costs. E) constant opportunity costs but decreasing real costs.
A flow variable:
a. Is an inconsistency in terms, because something cannot be a "variable" and a "flow" at the same time. b. Is measured at a point in time. c. Is measured over a period of time.