Explain why economists consider it to be one of the economic functions of government to provide a legal system
What will be an ideal response?
A market economy relies heavily on contracts and property rights. Property rights must be defined and protected if people are going to make investments in resources, and if people are going to exchange assets. Contracts must also be enforced. By providing a legal system, the government can ensure that a market system will function better.
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The GDP deflator is the ratio of
a. real GDP to nominal GDP multiplied by 100. b. real GDP to the inflation rate multiplied by 100. c. nominal GDP to real GDP multiplied by 100. d. nominal GDP to the inflation rate multiplied by 100.
Refer to the given data. If the prices of labor and capital are $9 and $15 respectively, the profit-maximizing firm will hire:
A. 5 units of labor and 3 of capital.
B. 5 units of labor and 2 of capital.
C. 4 units of labor and 4 of capital.
D. 3 units of labor and 4 of capital.