Which type of business has the least government rules and regulations affecting it?
A) sole proprietorship
B) partnership
C) corporation
D) They all have the same set of rules and regulations affecting them.
Figure 11-1
Refer to Figure 11-1. Diminishing marginal returns is illustrated in the per-worker
production function in the figure above by a movement from
A) A to C.
B) B to C.
C) C to D.
D) D to C.
If New Yorkers decrease their purchases of French champagne, assuming all else
remains constant, this will ________ of the United States.
A) increase the balance of trade
B) decrease net exports
C) decrease the current account balance
D) increase the trade deficit
E) increase the balance of payments
A consumer is willing to purchase a product up to the point where
A) he spends all of his income.
B) the marginal benefit is equal to the price of the product.
C) the quantity demanded is equal to the quantity supplied.
D) he is indifferent between consuming and saving.
Figure 2-10
Refer to Figure 2-10. In the circular flow diagram, market K represents
A) households.
B) product markets.
C) firms.
D) factor markets.
Unemployment arising from a persistent mismatch between the skills and
characteristics of workers and the requirements of jobs is called
A) frictional unemployment.
B) structural unemployment.
C) cyclical unemployment.
D) seasonal unemployment.
E) unnatural unemployment.
Figure 3-1
Refer to Figure 3-1. An increase in the price of a substitute would be represented by a
movement from
A) A to B.
B) B to A.
C) D1 to D2.
D) D2 to D1.
What are menu costs?
A) the full list of a firm’s costs of production
B) the costs to a firm of changing prices
C) the cost to a household of borrowing money when there is deflation
D) the opportunity cost of dining in a restaurant instead of at home
If credit card balances rise in the economy, then M1 will ________ and M2 will
________.
A) increase; increase
B) not change; increase
C) decrease; increase
D) not change; not change
E) increase; decrease
The Farm Factory, a booth at the local Farmer’s Market, sells fresh eggs for $1.50 per
dozen and fresh milk for $2.50 per gallon. What is the opportunity cost of buying a
dozen eggs?
A) 1 2/3 gallons of milk
B) 3/5 of a gallon of milk
C) $2.50
D) $1.50
The problem causing most recessions is too little
A) money (currency plus checking accounts).
B) spending.
C) unemployment.
D) taxes.