Which of the following would be the best example of a spot market?
a. the market for fine art
b. the market for bananas
c. the market for stocks and bonds
d. the market for baseball cards
Which of the following statements about U.S. unemployment is true?
a. All racial groups experience approximately the same rate of unemployment.
b. Black and white teenagers experience equally high rates of unemployment.
c. Blacks as a group experience higher rates of unemployment than do white teenagers.
d. Blacks experience higher rates of unemployment than do Hispanics.
e. White teenagers experience higher rates of unemployment than do any other group in
the population.
According to Say’s Law, supply creates its own demand.
“Rising prices” and “rising inflation” mean the same thing.
If we knew that the price of goods rose, on average, by 5 percent last year and by 4
percent this year, we would know
a. nothing about the rate of inflation
b. that the inflation rate is rising
c. that the inflation rate is falling
d. that we are in a stagflation
e. that we are in a recession
If British real GDP fell, there would be
a. a rightward movement along the supply of British pounds curve in the dollar-pound
market
b. a leftward movement along the supply of British pounds curve in the dollar-pound
market
c. an increased supply of British pounds to the dollar-pound market
d. a decreased supply of British pounds to the dollar-pound market
e. the tendency for the supply of British pounds curve to become steeper in the
dollar-pound market
In an economy with 4,000 unemployed people and 8,000 employed people, the
unemployment rate is
a. 50.0 percent
b. 40.0 percent
c. 33.3 percent
d. 60.0 percent
e. 25.0 percent
In the long run, large and continuing budget surpluses
a. mean higher taxes and a lower standard of living
b. mean a larger money supply and higher interest rates
c. are a problem because they crowd out private spending
d. permit the government to lower taxes, thereby encouraging work, investment, and
saving
e. mean a larger money supply and lower interest rates
A critical assumption
a. makes an economic model a more concrete representation of reality
b. eliminates unnecessary details from an economic model
c. has an important impact on the conclusions of an economic model
d. is usually implicit in an economic model
e. increases the level of abstraction of an economic model
Just as greater leverage multiplies a bank’s potential profits, it also multiplies a bank’s
potential losses.
Which of the following would be counted in U.S. GDP?
a. A new U.S.-produced radio bought by a Japanese citizen living in Kyoto
b. A used U.S.-produced computer bought by a French citizen living in Kansas
c. A new Japanese radio bought by a U.S. citizen in Rhode Island
d. A U.S. pianist’s concert sales in Britain
e. Stock in Microsoft Corporation bought by a Russian citizen
If imports increased by $100 million while GDP remained the same, which of the
following could have occurred, all else being the same?
a. Exports decreased by $100 million.
b. Consumption increased by $100 million.
c. Government spending decreased by $100 million.
d. Net exports increased by $100 million.
e. Private investment decreased by $100 million.