Jordan wants to sell her wedding gown for $250, but her cousin Jessica offered her
$375 for it. If the gown is sold for $375, what is Jordan’s producer’s surplus
Specialization and exchange result in
The real interest rate is calculated as the
a. expected rate of inflation divided by the nominal interest rate
b. real GDP plus the expected rate of inflation
c. nominal interest rate minus real GDP
d. nominal interest rate minus the expected rate of inflation
e. real GDP multiplied by the expected rate of inflation
In the classical model, the quantity of loanable funds supplied is
a. positively related to the level of income
b. negatively related to the price level
c. positively related to the price level
d. negatively related to the interest rate
e. positively related to the interest rate
Refer to Figure 14-8 above. If the interest rate is currently 5%,
a. the interest rate must fall to restore equilibrium.
b. the interest rate will not change.
c. the interest rate must rise to restore equilibrium.
d. there is an excess supply of money.
e. the excess demand for money is $200 billion.
Individuals in countries with __________ often spend considerable time trying to
secure resources from others.
If both labor demand and labor supply fall, what will happen to the real wage,
employment, and output?
a. The real wage will increase, real output will increase, but the effect on employment
depends upon the magnitudes of the shifts.
b. The real wage will increase, but the effects of employment and real output depend
upon the magnitudes of the shifts.
c. The real wage, employment, and real output will all decrease.
d. Employment and real output will decrease, but the effect on the real wage depends
upon the magnitudes of the shifts.
e. The real wage, employment, and real output will all increase.
If we included the purchases of used goods in GDP,
a. we would be overestimating GDP
b. we would be underestimating GDP
c. we would be accurately measuring GDP
d. the effect on GDP would vary depending on what year the goods were sold new
e. we could offset any measurement problems by also including purchases of stocks and
bonds
In the short-run macro model, equilibrium occurs when
a. all of the following conditions are satisfied
b. the unintended change in inventories is zero
c. total sales equals output
d. the aggregate expenditure line intersects the 45-degree line
e. GDP equals aggregate expenditure
The Fed has been able to achieve a zero rate of inflation throughout most of the 1990s.
The law of demand says that as the price of a good rises, the quantity demanded of the
good tends to fall.