If the dollar appreciates against the Mexican peso,
A) Mexican imports to the U.S. become more expensive.
B) U.S. exports to Mexico become less expensive.
C) U.S. exports to Mexico become more expensive.
D) The value of Mexican imports to the United States does not change.
If policy makers implement an expansionary fiscal policy but do not take into account
the potential for crowding out, the new equilibrium level of GDP is likely to
A) be at potential GDP.
B) be above potential GDP.
C) be below potential GDP.
D) There is insufficient information given here to draw a conclusion.
Tom Searchinger, a senior attorney at the Environmental Defense Fund, observed that
generous farm subsidies have encouraged farmers to produce more corn and more
wheat. How does this affect the market for fertilizer?
A) The supply of fertilizer increases.
B) The supply of fertilizer decreases
C) The demand for fertilizer increases.
D) The demand for fertilizer decreases.
In October 2013, Abercrombie & Fitch (ANF) posted a price-earnings ratio of 13. If the
price of the stock at that time was $36 per share, which of the following must have been
true?
A) ANF’s revenues that month were $4.68 million.
B) ANF’s earnings per share was $2.77.
C) ANF’s coupon payment was $23.23 per year.
D) ANF’s dividend yield for the year was 47%.
MPC + MPS =
A) 0.
B) 0.5.
C) 1.
D) 100.
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.
As a result of slow economic growth following the recession of 2007-2009, many
companies including Cisco Systems, Lockheed Martin, and Cracker Barrel Old Country
Store cut production and employment as a result of the sluggish growth in the total
amount of spending in the economy. The total amount of spending in the economy is
known as
A) deficit spending.
B) planned investment spending.
C) aggregate expenditure.
D) equilibrium spending.
Suppose that when the price of raspberries increases, Lonnie increases his purchases of
papayas. To Lonnie,
A) raspberries and papayas are complements.
B) raspberries and papayas are inferior goods.
C) raspberries and papayas are normal goods.
D) raspberries and papayas are substitutes.
Table 20-14
The table above reports the nominal average hourly earnings in private industry and the
consumer price index for 1965 and 2010. The real average hourly earnings for 1965 in
1982-1984 dollars equal
A) $1.28.
B) $6.49.
C) $8.28.
D) $15.45.
Figure 27-1
Suppose the economy is in short-run equilibrium above potential GDP and wages and
prices are rising. If contractionary policy is used to move the economy back to long-run
equilibrium, this would be depicted as a movement from ________ using the static
AD–AS model in the figure above.
A) D to C
B) C to B
C) A to E
D) B to A
E) E to A
Figure 5-16
Amit and Bree are the only two
homeowners on an isolated private road. Both agree that installing street lights along
the road would be beneficial and want to do so. Figure 5-16 shows their willingness to
pay for different quantities of street lights, the market demand for street lights and the
marginal cost of installing the street lights.
How much is Bree willing to pay to have 4 street lights installed?
A) $1,500
B) $1,800
C) $2,700
D) $7,200
Which of the following is a macroeconomics question?
A) What determines the inflation rate?
B) What determines the production of DVDs?
C) What factors determine the price of carrots?
D) What determines the wage of auto workers?
Which of the following is a macroeconomics question?
A) What determines the unemployment rate?
B) How is the production quantity of digital cameras determined?
C) What factors determine the price of iPhones?
D) What determines the wages and benefits of flight attendants?
Figure 2-4
Figure 2-4 shows various points on three different production possibilities frontiers for
a nation. A movement from Y to Z
A) represents an increase in the demand for plastic products.
B) could occur because of general technological advancements.
C) is the result of advancements in food production technology.
D) is the result of advancements in plastic production technology.
When groups of mortgages are bundled together by financial institutions and sold to
investors, these institutions are said to be ________ mortgage loans.
A) securitizing
B) underwriting
C) liquidating
D) harvesting
If in the market for apples the supply has decreased then
A) the supply curve for apples has shifted to the right.
B) there has been a movement upwards along the supply curve for apples.
C) the supply curve for apples has shifted to the left.
D) there has been a movement downwards along the supply curve for apples.
In which market structure is it not possible to practice price discrimination?
A) perfect competition
B) monopolistic competition
C) oligopoly
D) monopoly
What is a private cost of production? What is a social cost of production? When is the
private cost of production equal to the social cost of production?
What is the Difference between a supply schedule and a supply curve?
Scott is a manager at a pool cleaning business. He has hired 10 workers to clean pools
for him and is considering what type of payment scheme he should set up for his
workers. He can pay each of his workers $10 per hour to clean pools, or he can pay his
workers $20 for each pool a worker cleans. (It takes 2 hours, on average, for an
employee to clean a pool thoroughly.) If Scott wants to maximize the number of pools
his workers clean in one day, which payment scheme should he use? Explain.
Suppose the price of gasoline in July 2004 averaged $1.35 a gallon and 15 million
gallons a day were sold. In October 2004, the price averaged $2.15 a gallon and 14
million gallons were sold. If the demand for gasoline did not shift between these two
months, use the midpoint formula to calculate the price elasticity of demand. Indicate
whether demand was elastic or inelastic.
During a time when the inflation rate is increasing each year for a number of years, are
adaptive expectations or rational expectations likely to give the more accurate
forecasts? Briefly explain.
What are the differences between national income, personal income, and disposable
personal income?
According to monetary theory, if the money supply is growing at a rate of 5 percent,
real GDP is growing at a rate of 2 percent, and velocity is constant, what will the
inflation rate be?
Racial discrimination and other forms of discrimination based on irrelevant factors are
illegal. Can price discrimination be illegal as well?
What is a compensating differential?