According to Keynesians, an increase in the money supply will:
a. decrease the interest rate, and increase investment, aggregate demand, prices, real
GDP, and employment.
b. decrease the interest rate, and decrease investment, aggregate demand, prices, real
GDP, and employment.
c. increase the interest rate, and decrease investment, aggregate demand, prices, real
GDP, and employment.
d. only increases prices.
Exhibit 3A-1 Comparison of Market Efficiency and Deadweight Loss
As shown in Exhibit 3A-1, if the quantity supplied is 6 million pounds of ground beef
per year, the result is:
a. deadweight loss.
b. inefficiency.
c. overproduction.
d. all of the above are true.
e. none of the above are true.
The equation for determining real GDP for year X is:
a.
b.
c.
d.
The major protection against sudden mass attempt to withdraw cash from banks is the:
a. Federal Reserve.
b. Consumer Protection Act.
c. deposit insurance provided by the FDIC.
d. gold and silver backing the dollar.
Price ceilings are imposed if the government believes:
a. the market will not achieve an equilibrium price.
b. the market equilibrium price is too low.
c. an excess supply of the product exists.
d. the market equilibrium price is too high.
e. the demand will be less than the supply of the product.
Bondholders are internal users of company’s accounting information.
a. True
b. False
National income is calculated as GDP:
a. plus depreciation.
b. plus exports.
c. minus imports.
d. minus depreciation.
Which one of the following will shift the consumption function downward?
a. An increase in disposable income.
b. A decrease in disposable income.
c. Legislation making credit harder to obtain.
d. Lower tax rates.
e. A technological breakthrough.
An increase in both supply and demand causes which of the following?
a. Equilibrium price falls.
b. Equilibrium price rises.
c. Equilibrium price change is indeterminate.
d. Equilibrium quantity decreases.
e. Equilibrium quantity change is indeterminate.
A bank that has $10,000 in excess reserves can extend new loans up to a maximum of:
a. $1,000.
b. $9,000.
c. $10,000.
d. $100,000.
The three basic categories of resources are land, labor, and:
a. money.
b. time.
c. energy.
d. capital.
Mobile Power Corp. reported the following information for the year ended December
31, 2015.
What was the retained earnings balance for Mobile Power at December 31, 2014?
a. $ 165,000
b. $ 168,000
c. $ 182,000
d. $ 192,000
Exhibit 3-1 Market Demand
Suppose there are only three people in the economy: Jane, Harry, and Bob. The
individual demand for corn for each of these consumers is given in Exhibit 3-1. The
total quantity demanded of corn if the market price is $4 is ____.
a. 3
b. 25
c. 17
d. 8
e. 36
The investment demand curve as a function of various possible interest rates for the
entire economy is assumed to be:
a. positively sloped.
b. negatively sloped.
c. rising, then falling.
d. falling, then rising.
Which of the following makes short-term conditional low-interest loans to LDCs?
a. World Bank.
b. Agency for International Development (AID).
c. Agency for International Finance (AIF).
d. International Monetary Fund (IMF).
SeveralitemsfromthefinancialstatementsofStandardTiresarelistedbelow.Usethefollowing
answerchoicestoidentifythetypeofaccountforeachitemlisted.Placeyouranswersinthespac
eprovided.
a. Assets
b. Liabilities
c. Revenues
d. Expenses
e. Owners’ equity Accounts receivable
Exhibit 8-5 Aggregate expenditures function
As shown in Exhibit 8-5,
autonomous consumption is:
a. 0.
b. $1 trillion.
c. $2 trillion.
d. $3 trillion.
e. $6 trillion.
The three types of business activities in which all corporations engage are,
______________________, and _____________________.
What is the difference between positive and normative economics? How can knowledge
of positive economics be useful in normative economics?
The prime rate is a lagging indicator.
The government (G) category of gross domestic product (GDP) excludes welfare and
other transfer payments.
A graph is one method of expressing a model.
Surpluses cause prices to fall while shortages cause prices to rise.