(I)  Governments That Respect Property Rights and Freedom of Exchange While

question 47

Multiple Choice

(I)   Governments that respect property rights and freedom of exchange while following monetary (and fiscal) policies consistent with relative price stability, establish the foundation for economic growth.
(II)   Governments have often diminished the economic prospects of a nation by levying high taxes, instituting price controls, and following inflationary monetary policies.

• A) I is true; II is false.
• B) I is false; II is true.
• C) Both I and II are true.
• D) Both I and II are false.

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Definitions:

Government of Alberta

The provincial government responsible for public policy, regulation, and administration in the province of Alberta, Canada.

Treasury Bill

Short-term government securities issued at a discount from the face value and paying no interest, maturing usually in one year or less.

Issue Price

The price at which new securities are offered to the public by the issuer.

Simple Interest

Interest calculated only on the initial principal of a loan or deposit, without compounding.