What do we mean by "property rights" and why are they important?
What will be an ideal response?
Property rights are legally established titles to ownership, use, and disposal of factors of production and goods and services that are enforceable in the courts. Property rights are important because ownership of a resource provides a strong incentive to its owner to see that the resource they own is not damaged, overused, or degraded.
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In a system in which there is an administered exchange rate, what is the term used when the government sets the rate lower to buy more units of foreign currency?
A) a revaluation B) an appreciation C) a depreciation D) a devaluation
Which of the following pairs help explain why self-correction from a decline in aggregate demand in the economy may be slow rather than rapid?
A. Theory of compensation wage differentials; theory of derived demand for labor. B. Efficiency wage theory; insider-outsider theory. C. Insider-outsider theory; principle-agent problem. D. Externalities; efficiency wage theory.