If two individuals voluntarily agree to a transaction that only affects them (and no one else), it must be that the transaction is efficient.
Answer the following statement true (T) or false (F)
True
Rationale: If the two individuals agree voluntarily, then they must both believe the transaction makes them better off (or at least no worse off). If the transaction furthermore affects no one else, it means that the transaction has improved some people's (perceived) welfare without making anyone worse off.
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In the short run, an extremely large budget deficit run by a government can: a. shift the aggregate demand curve to the right and cause deflation
b. shift the aggregate demand curve to the left and cause unemployment. c. shift the aggregate demand curve to the right and cause severe inflation. d. shift the aggregate demand curve to the left and cause underemployment.
In economics, the planning horizon is defined as
A. the long run, during which all inputs are variable. B. the period of time for which technology is fixed. C. the shortest time period over which the firm can make decisions. D. the immediate future, such as the next day that any action can be taken.