If you were told that the exchange rate between the U.S. dollar and the Canadian dollar
was 1.2, that would mean that Canadians would have to spend ____ to buy a $12 watch
in New York City.
a. c and e
b. 10 U.S. dollars
c. 12 U.S. dollars
d. 14.4 U.S. dollars
e. 14.4 Canadian dollars
Which of the following is infrastructure?
a. Schools.
b. Roads.
c. Public health and sanitation services.
d. All of these.
Mathematically, the value of the tax multiplier in terms of the marginal propensity to
consume (MPC) is given by the formula:
a. MPC – 1.
b. (MPC – 1) / MPC.
c. 1 / MPC.
d. 1 – [1 / (1 – MPC)].
The branch of economics that focuses on decision making for the economy as a whole
is called:
a. normative economics.
b. macroeconomics.
c. microeconomics.
d. consumer economics.
A tariff is a tax on ____ goods that is designed to ____.
a. exported; protect domestic industries
b. exported; hurt foreign industries
c. imported; made domestic consumers pay more
d. imported; protect domestic industries
e. domestic; discourage imports
Financial accounting is the branch of accounting concerned with communication with
internal management.
a. True
b. False
In the upward-sloping segment of the aggregate supply curve,
a. when GDP increases, the price level rises.
b. when GDP increases, the price level does not change.
c. when GDP decreases, the price level rises.
d. when GDP increases, the price level falls.
e. there is no relationship between changes in GDP and changes in the price level.
If the marginal propensity to save (MPS) is 0.25, the value of the spending multiplier is:
a. 1.
b. 2.
c. 4.
d. 9.
Gross private domestic investment or simply business investment spending (I):
a. excludes all investment in the United States by foreign firms.
b. includes all capital in the United States.
c. includes net additions to the capital stock plus all new corporate stocks and bonds.
d. includes business expenditures on new factories, tools, and machinery.
Wei Company reported the following items on its financial statements for the year
ending December 31, 2015:
The income statement for Wei will report netincomefor the current year in the amount
of
a. $ 45,000
b. $ 65,000
c. $ 85,000
d. $ 465,000
Exhibit 5-8 GDP data (billions of dollars) Personal consumption expenditures $850
Interest 90
Corporate profits 150
Government spending 400
Depreciation 100
Rental income 70
Gross private domestic investment 120
Compensation of employees 830
Exports 120
Imports 70
Indirect business taxes 80
Proprietors’ income 120
Personal income taxes 110
Social Security taxes 50
Transfer payments 160 In Exhibit 5-8, disposable personal income (PI) is:
a. $2,180 billion.
b. $1,200 billion.
c. $2,210 billion.
d. $1,180 billion.
e. $1,290 billion.
If a bank keeps some of its excess reserves, the money multiplier:
a. increases.
b. stays the same.
c. goes to zero.
d. decreases.
e. increases, then decreases.
Morton Corporation reported the following information for the year ended December
31, 2015:
What was the balance of Morton’s’ retained earnings at January 1, 2015?
a. $21,000
b. $29,000
c. $31,000
d. $35,000