Wealth in the hands of Americans has been
a. rising because of the trade deficit
b. rising in spite of the trade deficit
c. falling because of the trade deficit
d. falling in spite of the trade deficit
e. falling in the last twenty years
The classical model fails to recognize that
a. labor markets always clear
b. managers develop paternalistic feelings toward their workers
c. labor markets do not always clear
d. what was true yesterday might not be true today
e. search costs are low during recessions
According to the assumption of consumer rationality, a consumer who prefers one head
of broccoli to one head of cauliflower, one head of cauliflower to one package of
brussel sprouts, and one
Refer to Figure 9-7. Everything else equal, which attainable production point will result
in the most economic growth?
a. A
b. B
c. C
d. D
e. all points would promote growth equally
In Figure 16-3, the opportunity cost in Costa Rica of producing one additional bicycle
is
Figure 16-3
Quantities of goods that can be produced in one day with available resources:
a. 10 rugs
b. 20 rugs
c. 4 rugs
d. 5 rugs
e. 1/5 of a rug
Suppose that equilibrium in the dollar-pound market occurs where 300 million pounds
are demanded at a price of $1.75 per pound. If the current exchange rate is $1.60 per
pound, we know that
a. the dollar-pound market is in equilibrium
b. there is an excess demand for pounds, so the dollar price of the pound will rise
c. there is an excess demand for pounds, and the pound is overvalued
d. there is an excess supply of pounds, and the dollar price of the pound will rise
e. there is an excess supply of pounds, and the dollar price of the pound will fall
If food is measured on the horizontal axis of a budget line diagram, and clothing is
measured on the vertical axis, an increase in
Refer to Figure 15-1. Assume the economy is in equilibrium at $7 trillion. If the
changes in all three graphs were caused by the same event, what was that event?
a. An increase in nominal income
b. An increase in the price level
c. An increase in the interest rate
d. An increase in taxes
e. An increase in real income
If an initial increase in investment spending of $30 caused equilibrium output to
increase by $120, what is the value of the MPC?
a. 0.25
b. 0.50
c. 0.60
d. 0.75
e. 0.80
Everything else constant, who is least likely to lose from unexpected inflation?
a. A retired person whose pension payments are fixed in dollars
b. A person with a large amount of money deposited in a savings account
c. A bank scheduled to receive fixed nominal mortgage payments
d. A homeowner scheduled to make fixed nominal mortgage payments
e. A consumer who spends extra time shopping for the lowest prices
Under market capitalism, resources are allocated primarily through
If the unemployment rate has reached an all-time low, the production of output is
probably
a. high
b. low
c. fluctuating
d. stable
e. inefficient
In Figure 4-5, at a temporary price of $4,
Whenever there is an increase in autonomous consumption spending, there will be
a. an upward shift of the aggregate expenditure line causing equilibrium GDP to rise
b. an upward shift of aggregate expenditure line, but no change in equilibrium GDP
c. no change in the aggregate expenditure line, but equilibrium GDP will rise
d. an upward shift of the aggregate expenditure line, causing equilibrium GDP to fall
e. no change in the aggregate expenditure line or equilibrium GDP