The role of government in shifting the production possibilities curve to the right is considered:
A) supporting economic growth.
B) redistributing income.
C) providing certain goods and services.
D) enforcing private property rights.
Ans: A) supporting economic growth.
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Refer to the figure above. Which of the following explains the impact on the domestic buyers and sellers when the country opens to free trade?
A) Both the sellers and the buyers are made worse off. B) Both the sellers and the buyers gain. C) The domestic firms lose but the buyers gain. D) The domestic firms gain but the buyers lose.
Adam Smith wrote that the:
a. economic problems of eighteenth-century England were caused by free markets. b. government should control the economy. c. pursuit of private self interest promotes the public interest in a market economy. d. public or collective interest is not promoted by people pursuing their self interest.