In a market-oriented economy, the choice between the production of consumer goods and physical capital is the result of decisions made by:
a. the government

Refer to Scenario 8-1. The value added of CANOES-R-US for each canoe equals

A) $1,200. B) $800. C) $500. D) $400.

Which of the following is true?

a. When increased government purchases or expansionary monetary policy does give the economy a boost, no one knows precisely how long it will take to do so. b. Given the difficulties of timing stabilization policy, an expansionary monetary policy intended to reduce the severity of a recession may instead add inflationary pressures to an economy that is already overheating. c. If velocity changes, but it moves in a fairly predictable pattern, the connection between money supply and GDP is still fairly predictable. d. All of the above are true.