If technological change increases the profitability of new investments for firms, then the
________ curve for loanable funds will shift to the ________.
A) supply; right
B) supply; left
C) demand; right
D) demand; left
Tanesha sells homemade candles over the Internet. Her annual revenue is $64,000 per
year, the explicit costs of her business are $17,000, and the opportunity costs of her
business are $22,000. What is her economic profit?
A) $17,000
B) $25,000
C) $42,000
D) $47,000
Figure 15-7
Suppose the economy is in short-run equilibrium above potential GDP, the
unemployment rate is very low, and wages and prices are rising. Using the static AD–AS
model in the figure above, the correct Fed policy for this situation would be depicted as
a movement from
A) A to B.
B) B to C.
C) C to B.
D) A to E.
E) C to D.
The coupon rate of a bond is equal to
A) the coupon payment.
B) the interest payment.
C) the interest rate.
D) the face value.
Suppose the price of capital and labor remain constant. As a firm’s expenditures for
capital and labor increase, its isocost line
A) shifts out parallel to the original isocost line.
B) shifts in parallel to the original isocost line.
C) rotates outward on the Y-intercept.
D) rotates outward on the X-intercept.
A corporation’s management
A) owns the corporation.
B) hires the board of directors.
C) is liable for the corporation’s debts.
D) operates and controls a corporation in its day-to-day activities.
In 2013, the U.S. auto industry experienced rising sales. The automobile industry was
experiencing the effects of
A) inflation.
B) the underground economy.
C) the business cycle.
D) depreciation.
Figure 15-4 Figure
15-4 shows the demand and cost curves for a monopolist.
What is the amount of the monopoly’s total cost of production?
A) $21,600
B) $17,700
C) $9,340
D) $7,800
Figure 11-4
Suppose the economy gains more capital per hour worked and experiences
technological change. This is shown in the figure above by the movement from
A) E to B to D.
B) A to B to C.
C) A to E.
D) A to D.
The marginal product of labor is calculated using the formula
A) L/Q.
B) L/Q.
C) Q/L.
D) Q/L.
As a group, people with high incomes are likely to have
A) greater-than-average family inheritances and greater than average SAT scores.
B) greater-than-average holdings of stocks and bonds and lower-than-average
productivity.
C) greater-than-average productivity and greater-than-average amounts of capital.
D) a stable marriage and no children.
If the Federal Reserve announces that its target for the federal funds rate is falling from
3 percent to 2.25 percent, how do you expect workers and firms to react?
A) As long as the Fed’s announcement is credible, workers and firms will decrease their
consumption and investment spending, which will decrease aggregate demand and
inflation.
B) As long as the Fed’s announcement is credible, workers and firms will increase their
consumption and investment spending, which will increase aggregate demand and
inflation.
C) If the Fed’s announcement is not credible, workers and firms will not expect inflation
to rise so they will increase their consumption and investment spending, which will
decrease aggregate demand and increase inflation.
D) Workers and firms will incorporate the decrease in interest rates into their
expectations of inflation, and they will expect inflation to fall as a result of Fed’s policy
announcement.