Lakeland Corporation’s endÂofÂyear balance sheet consisted of the following amounts:
What is Lakeland’s retainedearningsbalance at the end of the current year?
a. $13,000
b. $34,000
c. $76,000
d. $173,000
Scarcity can be eliminated if:
a. people satisfy needs rather than wants.
b. sufficient new resources were discovered.
c. output of goods and services were increased.
d. none of these.
The balance of trade is measured by which of the following expressions?
a. The value of exported goods and services minus the value of imported goods and
services
b. The value of income receipts on investments minus income payments on investments
c. The value of goods exports minus the value of goods imports
d. The value of government spending minus the value of all taxes received
e. The balance on capital account plus the balance on current account
Lower taxes on businesses will shift the aggregate:
a. demand curve rightward.
b. demand curve leftward.
c. supply curve rightward.
d. supply curve leftward.
Economists believe that scarcity forces everyone to:
a. satisfy all their wants.
b. abandon consumer sovereignty.
c. lie about their wants.
d. create unlimited resources.
e. make choices.
In order to avoid the free-rider problem, which of the following goods is best provided
by the government and paid for with tax dollars?
a. Automobiles.
b. Lighthouses.
c. Bread.
d. Prescription drugs.
e. Windows.
Which of the following is considered part of M2?
a. Savings deposits.
b. Money market mutual fund shares.
c. Small time deposits of less than $100,000.
d. All of these.
Trade restrictions imposed in the name of national security have been recommended by
protectionists in order to:
a. develop strong defense-related industries.
b. avoid dependence on foreign suppliers during wartime.
c. reduce the necessity of stockpiling strategic supplies.
d. all of these.
Suppose we shopped for a basket of goods in Year 1 and it cost $350. Suppose the same
basket of goods adds up to $385 in Year 2. If we use Year 1 as a base year, what would
be the Year 2 CPI?
a. 35.
b. 90.
c. 100.
d. 110.
e. 135.
Hyperinflation refers to a situation in which:
a. prices are rising extremely rapidly.
b. prices are falling extremely rapidly.
c. the price level is extremely high.
d. the price level is extremely low.
If an individual’s income increases, then the demand for a normal good will:
a. decrease.
b. increase.
c. remain constant.
d. rotate.
e. fall to zero.
The aggregate demand curve shows how real GDP purchased varies with changes in:
a. unemployment.
b. output.
c. the price level.
d. the interest rate.
Exhibit 12-2 Income and taxes for two persons Name
Income Income
Tax Bill
Mitchell $60,000 $6,000
Ryan $10,000 $1,000 In Exhibit 12-2, we can tell that the tax shown here is:
a. a poll tax.
b. proportional.
c. progressive.
d. equitable.
e. regressive.
Exhibit 1A-1 Straight line
as X increases along the horizontal axis,
corresponding to points A-B on the line, the Y values increase. The relationship
between the X and Y variables is:
a. direct.
b. inverse. c. independent.
d. variable.
Sawyer Corporation purchased land in 2009 for $490,000. In 2015, it purchased a
nearly identical parcel of land for $660,000. In its 2015 balance sheet, Sawyer valued
these two parcels of land at a combined value of $1,320,000. By reporting the land in
this manner, Sawyer Corporation has violated which of the following? a. Going concern
assumption
b. Cost principle
c. Monetary unit measure
d. Time Period assumption
Exhibit 1A-1 Straight line
Straight line AB in Exhibit 1A-1 shows
that:
a. increasing values for X will decrease the values of Y.
b. decreasing values for X will increase the values of Y. c. there is a direct relationship
between X and Y.
d. all of these.
Supply-side economic policies are designed to shift the aggregate supply curve to the
left, whereas Keynesian economic policies focus on shifting the aggregate demand
curve to the right during recessions and to the left during economic expansions.
A country can develop without a large natural resource base.
A country with a high GDP per capita is classified as an industrially advanced country
(IAC).
A weaker dollar will stimulate sales of U.S. exports.
The amount of checkable deposits in an economy cannot exceed the amount of currency
that the government has issued.
Saving is disposable personal income spent on investment.
An increase in consumer wealth shifts the consumption function upward.
What is the difference between the Keynesian and rational expectations theories
concerning the success of stabilization policy?
The crowding-out effect indicates that an increase in a fiscal deficit financed by
borrowing will increase interest rates and thereby crowd out some domestic investment
spending.