If producers incorrectly set the price of their product too high a:
A. shortage will result and consumers will bid the price down to equilibrium.
B. surplus will result and excess goods in inventory will signal to producers to lower their prices.
C. shortage will result and consumers will bid the price up to equilibrium.
D. surplus will result and excess goods in inventory will signal the producers to restrict output until sales increase.
B. surplus will result and excess goods in inventory will signal to producers to lower their prices.
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Why has nominal GDP increased historically more rapidly than real GDP in the United States?
a. because of inflation b. because of deflation c. because of statistical discrepancies d. because of high interest rates
Which of the following is the most fundamental function of government?
a. protection of individuals and their property b. imposing progressive taxes to fund income-transfer programs c. regulating prices and wages d. provision of postal services and garbage collection