An economic growth model explains
A) changes in real GDP per capita in the long run.
B) how changes in the money supply affect real interest rates.
C) changes in government tax policies over time.
D) the growth rate of the price level over time.
How will an interest rate decrease in the United States affect equilibrium in the foreign
exchange market?
A) The equilibrium exchange rate will increase, and the equilibrium quantity of dollars
traded cannot be determined.
B) The equilibrium exchange rate will decrease, and the equilibrium quantity of dollars
traded cannot be determined.
C) The equilibrium exchange rate cannot be determined, and the equilibrium quantity of
dollars traded will increase.
D) The equilibrium exchange rate will increase, and the equilibrium quantity of dollars
traded will increase.
The owners of a ________ have a separate legal distinction from the business.
A) corporation
B) partnership
C) sole proprietorship
D) All of the above are correct.
Relative to productivity growth in the United States, which of the following countries
experienced the largest decline in productivity growth from 1990 to 2012?
A) Canada
B) Japan
C) Germany
D) the United Kingdom
When production in an economy grows more quickly than the population in that
economy, which of the following must be occurring?
A) Real GDP is falling.
B) Incomes are growing at a slower rate than the population.
C) Real GDP per capita is rising.
D) Living standards are falling.
Figure 13-1
Refer to Figure 13-1. Ceteris paribus, an increase in firms’ expectations of the future
profitability of investment spending would be represented by a movement from
A) AD1 to AD2.
B) AD2 to AD1.
C) point A to point B.
D) point B to point A.
Using the market for loanable funds, which of the following has the potential to raise
the real interest rate?
A) an increase in the demand for loanable funds
B) an increase in the quantity of loanable funds demanded
C) an increase in the supply of loanable funds
D) an increase in the quantity of loanable funds supplied
Figure 18-2
Refer to Figure 18-2. Consider the market for U.S. Dollars against the British pound
shown in the graph above. From this graph we can conclude that the dollar price of a
British pound has ________ to ________ dollars per pound
A) decreased; 0.46
B) increased; 2.17
C) decreased; 2.00
D) increased; 0.50
Suppose the economy is at a short-run equilibrium GDP that lies above potential GDP.
Which of the following will occur because of the automatic mechanism adjusting the
economy back to potential GDP?
A) Output will increase.
B) Prices will decline.
C) Unemployment will decline.
D) Short-run aggregate supply will shift to the left.
Which of the following would cause both the equilibrium price and equilibrium
quantity of barley (assume that barley is an inferior good) to increase?
A) an increase in consumer income
B) a drought that sharply reduces barley output
C) a decrease in consumer income
D) unusually good weather that results in a bumper crop of barley
The ________ illustrates the relationship between the price level and the quantity of
planned aggregate expenditure, holding constant all other factors that affect aggregate
expenditure.
A) aggregate demand curve
B) savings line
C) 45-degree line
D) consumption function
An increase in the discount rate ________ bank reserves and ________ the money
supply if banks respond appropriately to the change in the rate.
A) increases; increases
B) increases; decreases
C) decreases; increases
D) decreases; decreases
In 2008, the Fed and the Treasury began attempting to stabilize the commercial banking
system through the Troubled Asset Relief Program (TARP) by
A) allowing domestic banks to be taken over by foreign banks.
B) permitting banks to sell commercial bonds to the Federal Reserve Bank.
C) allowing banks to double any outstanding claims for federal deposit insurance
reimbursements.
D) providing funds to banks in exchange for stock.
Figure 7-1
Figure 7-1 shows the U.S. demand and supply for leather footwear.
Refer to Figure 7-1. Suppose the government allows imports of leather footwear into
the United States. What will be the quantity of imports?
A) Q0
B) Q1
C) Q2
D) Q2 – Q0
Consumers usually pay less than the total cost of medical treatment because
A) a third party, usually an insurance company, often pays most of the bill.
B) the federal government pays for most medical procedures.
C) competition forces doctors and hospitals to charge prices that do not cover their
costs.
D) a third party, usually an employer, often pays most of the bill.
Between 1981 and 2011, deaths from kidney disease increased largely due to the effects
of
A) increasing obesity.
B) increasing alcohol consumption.
C) increased smoking.
D) increased pollution.