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Which of the following statements is false?
a. Consumers receive more consumers' surplus when tariffs do not exist.
b. Producers receive more producers' surplus when tariffs do exist.
c. A tariff results in a net loss to society.
d. With a tariff, the gains to the winners are less than the losses to the losers.
e. none of the above
A price ceiling is a government-mandated
a. minimum price below which legal trades cannot be made.
b. maximum price above which legal trades cannot be made.
c. minimum price above which legal trades cannot be made.
d. maximum price below which legal trades cannot be made.
Suppose that the price index in 1999 was 170 and your salary was $44,000. Suppose in
2016 the consumer price index will be 290. What salary will you have to earn in 2016
in order to equal your 1999 real income?
a. $66,000
b. $77,647
c. $75,059
d. $83,209
A rise in the expected price level leads to an expectation that real wages will
____________, which will cause people to work __________, shifting the SRAS curve
_______________.
a. rise; more; rightward
b. rise; less; leftward
c. fall; more; rightward
d. fall; less; leftward
When a country imposescapital controls, it is controlling the
a. amount of money flowing in or out of the country.
b. amount of reserves that banks must hold.
c. portion of bank deposits that must be held at its central bank.
d. portion of bank deposits that must be used for loans to the government.
Exhibit 9-6
If the economy is self-regulating and currently at point 1, what is going to happen?
a. Wages rise, the SRAS curve shifts to the right until it passes through point 3; in
long-run equilibrium the price level is lower and Real GDP is higher than at point 1.
b. Wages fall, the SRAS curve shifts to the left until it passes through point 2; in
long-run equilibrium the price level is higher and Real GDP is lower that at point 1.
c. Wages fall, the SRAS curve shifts to the right until it passes through point 3; in
long-run equilibrium the price level is lower and Real GDP is higher than at point 1.
d. Wages rise, the AD curve shifts to the right until it passes through point 4; in long-run
equilibrium the price level and Real GDP are higher than at point 1.
e. Prices rise, the AD curve shifts to the right until it passes through point 4; in long-run
equilibrium the price level and Real GDP are higher than at point 1.
Which of the following is true?
a. All economists agree that the tax multiplier is greater than the government spending
multiplier.
b. All economists agree that the tax multiplier is smaller than the government spending
multiplier.
c. There is disagreement among economists regarding the size of the tax multiplier
relative to the size of the government spending multiplier.
d. In the standard Keynesian textbook analysis, the tax multiplier is greater than the
government spending multiplier.
e. c and d
In the early 1900s tariffs accounted for ____________ of all federal government
revenues, whereas today they account for less than ____________ percent.
a. one-tenth; 4
b. half; 0.5
c. one-quarter; 5
d. half; 2
If $1 is equal to 120 yen, then 1 yen is equal to approximately
a. $1.20
b. $0.94
c. $0.83
d. $0.0083
e. none of the above
As a result of contractionary monetary policy, the open-economy outcome, compared to
the closed-economy outcome, features a ___________ fall in Real GDP and a
____________ fall in the price level.
a. larger; larger
b. larger; smaller
c. smaller; larger
d. smaller; smaller
Exhibit 6-2
The employment rate in year 3 is
a. 12 1/2 percent.
b. 33 1/3 percent.
c. 70 percent.
d. 66 2/3 percent.
e. 25 percent.
The longer you hold stocks in the stock market, the more likely you will earn a positive
return, ceteris paribus.
a. True
b. False
Exhibit 32-4
At the market equilibrium price of the good, producers€ surplus is the area
a. D + E
b. A + B + C + D + E
c. A + B + C
d. C + E
e. none of the above
Exhibit 4-8
Suppose that wheat producerslobby the government for a price floor and receive
one.This price floor is set at PF.What is the change in the total surplus at the price floor,
compared to at the equilibrium price?
a. There was a gain in total surplus equal to (area 1 + 2 + 3)
b. There was a gain in total surplus equal to (area 1 + 2 + 3 + 4 + 5)
c. There was a loss in total surplus equal to (area 4 + 5)
d. There was a loss in total surplus equal to (area 4 + 5 + 6 )
Within the production possibilities frontier (PPF) framework, choice is depicted by the
a. PPF itself.
b. PPF being bowed outward.
c. need to select among the points making up the PPF.
d. straight-line PPF.
The lower the price of medical care in general, the higher the
____________________________ medical care and the ______________________
specific items that make up medical care (such as x-rays).
a. quantity demanded of; higher the demand for
b. demand for; higher the demand for
c. quantity demanded of; lower the demand for
d. demand for; higher the quantity demanded of
Exhibit 15-3
The economy is initially at point 1. Ideally, __________ monetary policy will move the
economy to point __________.
a. expansionary; 9
b. contractionary; 4
c. expansionary; 8
d. expansionary; 7
e. contractionary; 2
Which of the following is more nearly consistent with a global savings glut?
a. high interest rates and the global savings-World GDP ratio is low
b. low interest rates and the global savings-World GDP ratio is low
c. high interest rates and the global savings-World GDP ratio is high
d. low interest rates and the global savings-World GDP ratio is high
e. none of the above
In 1961, President Kennedy committed the United States to a manned lunar mission by
the end of the decade. Few thought it could actually be done, but of course it did, with
five months to spare. This story might illustrate a __________ growth theory argument
that technological change __________.
a. new; can be deliberately accelerated
b. new; relies on government policy
c. neoclassical; can be deliberately accelerated
d. neoclassical; relies on government policy
