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Which of the following best defines the specialization of resources?
a. Workers are compensated as individuals.
b. Special resources are needed to produce most goods.
c. Each resource is paid for in full.
d. Each resource is paid the most if it is specialized.
e. Each resource is focused on a limited number of productive activities.
If the rate of economic growth is positive, then everyone becomes better off.
When explaining expansions and recessions, the classical model is
a. reliable
b. seriously flawed
c. the favorite explanatory tool of economists
d. overly focused on the labor market
e. sometimes accurate and sometimes not
Which of following is an example of fiat money?
a. US dollars
b. Gold
c. Diamonds
d. Silver
e. Fur
Which of the following can lead to stagflation?
a. A decrease in the money supply
b. A decrease in autonomous consumption
c. A prolonged increase in oil prices
d. An increase in government spending
e. A decrease in oil prices.
Targeting the wealthy in a less-developed country in order to achieve reductions in
poverty can drive the wealthy to relocate.
If the boat industry produced $20 billion worth of boats, but $50 billion worth of boats
were sold to consumers, the decrease in inventory would lead to
a. an increase in the nation's capital
b. more individuals investing in the automobile market
c. a decrease in the nation's capital stock
d. fewer individuals buying cars
e. an overestimation of boat production
Which of the following lists represent leakages from the circular flow?
a. Government purchases, net taxes and household saving.
b. Planned investment, net taxes and government purchases.
c. Household saving and planned investment.
d. Planned investment and net taxes.
e. Household saving and net taxes.
Which of the following statements about demand is correct?
a. A change in the price of bicycles will not lead to a shift of the demand curve for
bicycles.
b. A change in the price of automobiles will lead to a shift of the demand curve for
motorcycles.
c. A change in demand is equivalent to a movement along a given demand curve.
d. When price falls, so does the quantity demanded.
e. When the demand curve shifts to the right, so will the supply curve.
Which of the following is the result of a banking panic?
a. A decrease in the demand deposit multiplier
b. An increase in the money supply
c. An increase in bank reserves
d. A decrease in the money supply
e. An increase in the demand deposit multiplier
If the interest rate is above its equilibrium value, the price of
a. bonds will fall
b. real estate will rise
c. bonds will rise
d. stocks will fall because of fluctuations in the bond market
e. money will rise
