Between 1981 and 2011, deaths from cancer have increased in the United States.
Selling a product at a price below its cost is known as dumping.
Market economies tend to grow more quickly than centrally-planned economies.
When a business is set up as partnership, the owner of the business faces unlimited
liability.
If the actual rate of inflation exceeds the expected rate of inflation, the actual real wage
is greater than the expected real wage and unemployment falls.
In a closed economy with fixed or autonomous (non-income dependent) taxes, the
balanced budget government purchases multiplier is negative.
The lengths of the recession and expansion phases and which sectors of the economy
are most affected will rarely be the same in any two business cycles.
If a corporate bond with face value of $5,000 has an interest rate of 4 percent paid once
a year for a term of 30 years, what is the size of the coupon payment?
A) $4
B) $200
C) $1,250
D) $5,000
Table 14-3 Suppose OPEC
has only two producers, Saudi Arabia and Nigeria. Saudi Arabia has far more oil
reserves and is the lower cost producer compared to Nigeria. The payoff matrix in Table
14-3 shows the profits earned per day by each country. “Low output” corresponds to
producing the OPEC assigned quota and “high output” corresponds to producing the
maximum capacity beyond the assigned quota.
Is there a dominant strategy for Saudi Arabia and, if so, what is it?
A) Yes, the dominant strategy is to produce a high output.
B) Yes, the dominant strategy is to produce a low output.
C) No, there is no dominant strategy.
D) Yes, it has a dominant strategy depending on what Nigeria does.
Which of the following is not included in the balance of the financial account of the
United States?
A) a purchase of Toyota stock by Ford
B) a purchase of GE stock by a firm in China
C) a purchase of U.S. car manufacturing plant by Toyota
D) a purchase of a German brewery by the U.S. company, Budweiser
E) a purchase of German financial services by Chase Manhattan bank
Average fixed costs of production
A) remain constant.
B) will rise at a fixed rate as more is produced.
C) graph as a U-shaped curve.
D) fall as long as output is increased.
In Thailand in the late 1990s, there was pressure for the value of the baht to decline as
foreign investors began to
A) sell off investments they had made in Thailand and traded in their baht for dollars.
B) sell off investments they had made in Thailand and traded in their dollars for baht.
C) increase their investments in Thailand and exchanged their baht for dollars.
D) increase their investments in Thailand and exchanged their dollars for baht.
Of the following, the most to the rapid rise in health care costs in the United States can
be attributed to
A) the cost of malpractice insurance
B) the cost to treat uninsured patients
C) slow growth in labor productivity in health care
D) the cost of malpractice lawsuit settlements
Economies where goods and services are traded directly for other goods and services
are called ________ economies.
A) trade
B) barter
C) direct
D) seigniorage
Comparative advantage means the ability to produce a good or service
A) at a lower selling price than any other producer.
B) at a lower opportunity cost than any other producer.
C) of a higher quality than any other producer.
D) at a higher profit level than any other producer.
Figure 7-1 Figure 7-1 shows the U.S.
demand and supply for leather footwear. Under autarky, the consumer surplus is area
A) R.
B) S.
C) R + S + V.
D) S + V.
All of the following are part of the ‘state health exchanges” provision of the Patient
Protection and Affordable Care Act (ACA) except
A) each state is required to establish an Affordable Insurance Exchange by 2014.
B) small businesses with fewer than 50 employees will be exempt from being required
to participate in the program.
C) low-income individuals will be eligible for tax credits to offset the costs of buying
health insurance.
D) health insurance policies that meet certain specified requirements will be offered by
state-run agencies, by non-profit firms, or by the federal government.
Table 9-12 Production and
Consumption Production
Without Trade With Trade
Estonia and Morocco can produce both swords and belts. Table 9-12 shows the
production and consumption quantities without trade, and the production numbers with
trade.
All of the following are terms of trade that could possibly benefit both countries except
A) 1 belt : 1.33 swords
B) 1 belt : 1.5 swords
C) 1 belt : 1.75 swords
D) 1 belt : 2.25 swords
Article Summary. Due to falling sales and lower profit margins, clothing retailer
Aeropostale announced it would be closing more stores than originally planned. In
August, the company announced it would be closing between 30 and 40 locations
in 2013, up from the previously announced 15 to 20. Compared to the previous
year, net sales fell 6 percent and the company reported a loss of $33.7 million for
the second quarter of 2013, and the trend was expected to continue into the third
quarter. Explaining the downturn, Aeropostale chief executive Thomas P. Johnson
stated “Our business was pressured by a challenging teen retail environment with
weak traffic trends and high levels of promotional activity.” Source: Andrew
Klips, “Aeropostale Losses Accelerate, Closing More Stores,” equities.com, August
23, 2013. Use a graph to illustrate average total cost curves for Aeropostale before and
after closing the 30 to 40 stores. Assume that after closing the stores, Aeropostale will
be producing at minimum average total cost.
What is the macroeconomic consequence if firms accumulate large amounts of
unplanned inventory at the beginning of a recession?
Explain why expansionary monetary policy would not result in reduced unemployment
rates if workers and firms have rational expectations.
Suggest two policies the government could pursue to help increase the accumulation of
knowledge.
There are many cattle ranchers in the world, and there are also many McDonald’s
restaurants in the world. Why, then, does a McDonald’s restaurant face a downward
sloping demand curve while a cattle rancher faces a horizontal demand curve?
Suppose 180,000 people are employed, 20,000 people are unemployed, and 50,000
people are out of the labor force, then calculate the labor force participation rate.
Why does continued foreign investment in U.S. stocks and bonds and foreign
companies continuing to build factories in the United States result in a current account
deficit in the United States?
Identify four reasons for high entry barriers. Briefly explain each reason.
Is knowledge capital subject to the law of diminishing returns? Explain.