Which of the Following Is NOT a Device to Reduce

question 293

Multiple Choice

Which of the following is NOT a device to reduce transaction costs?

• A) Shopping centers
• B) Auto dealers located close together
• C) Government prohibitions on advertising
• D) Banks that direct funds from savers to borrowers

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Definitions:

Spending Multiplier

The ratio of a change in aggregate income to the initial change in spending that brought it about, illustrating the larger impact on income.

Government Purchases

Expenditures made by the public sector on goods and services, including infrastructure and public safety.

Net Taxes

The total amount of taxes collected by the government minus any transfer payments and subsidies.

GDP

Gross Domestic Product, a measure of the economic performance of a country, evaluating the total value of all goods and services produced over a specific time period.