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Questions and Answers
In a modern mixed economy, who decides what goods and services will be produced?
In a modern mixed economy, who decides what goods and services will be produced?
- Only the consumers
- Producers, consumers, and government (correct)
- Only the government
- Only the producers
What do economic models aim to do?
What do economic models aim to do?
- Magnify the complexity of economic issues in order to provide useful data
- Make no assumptions in order to remain as accurate as possible
- Cannot be used to analyze real-world issues
- Simplify versions of reality to make analysis feasible (correct)
What would cause the equilibrium price of white bread to decrease and the equilibrium quantity of white bread to increase?
What would cause the equilibrium price of white bread to decrease and the equilibrium quantity of white bread to increase?
- A decrease in the price of flour
- An increase in the price of rye bread, a substitute for white bread (correct)
- An increase in the price of flour
- An increase in the price of butter, a complement for white bread
What does the production possibilities frontier show?
What does the production possibilities frontier show?
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What does the supply schedule show?
What does the supply schedule show?
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