Which of the following statements is true?

a

Markets and prices help allocate goods and resources efficiently.

b

Market systems reward the development of new technologies thereby encouraging their development and implementation.

c

Specialization prevents economies from taking advantage of their resources.

d

All of the above.

e

Only a) and b)

Question 23(1 point)

Which of the following statements is true?

a

The law of demand tells us that as the price of a good increases, the quantity demanded of the good increases, ceteris paribus (other things equal).

b

Diminishing marginal utility refers to the increase in the additional satisfaction that results as one consumes additional units of a good or service.

c

The income effect (of a fall in price of a good) tells us that as the price of a good (we buy) drops, the purchasing power of income increases, which in turns enables the consumer to buy more of the good without having to reduce the purchases of other goods.

d

All of the above.

e

Only a) and b)

Question 24(1 point)

Which of the following statements is true?

a

Nominal GDP measures the dollar-value of the goods and services produced in the economy during a year, at their current prices.

b

Even if the economy continues to produce the same quantity of goods and services, just because there is inflation (prices are going up) nominal GDP will decrease.

c

The unemployment rate is the percentage of the workforce that is not working but is actively looking for a job.

d

All of the above.

e

Only a) and b)