How does imperfect information affect market decisions?
a. It doesn't, because information is generally excellent.
b. It leads to inefficient outcomes in which expected benefits and actual benefits diverge.
c. It leads to wasteful attempts to improve information.
d. It leads to exploitation of sellers by buyers.
b
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A price level increase tends to reduce net exports, thereby reducing the amount of real goods and services purchased in the United States. Economists refer to this phenomenon as
A) the barrier effect. B) the Gross Domestic Product (GDP) effect. C) the open-economy effect. D) the wealth effect.
Which statement is true?
A. One of the functions of money is that it serves as a receipt for gold. B. The most important function of money is that it serves as a medium of exchange. C. Barter requires specialization. D. None of the statements are true.