During the expansion phase of a business cycle
a. employment and output are both at a peak
b. employment and output are both rising
c. employment is falling and output is rising
d. unemployment is rising and output is falling
e. employment is rising and output is falling
If income decreases, the budget constraint will shift in but the slope will remain the
same.
You just won the lottery. You have a choice of three different prize options.
Option #1: receive $1,200 immediately
Option #2: receive $1,500 a year from now
Option #3: receive $5,000 five years from now.
If the interest rate is 10% the ranking of the options, from the lowest present value to
the highest is
The rise in bank failures in the late 1980s and early 1990s occurred
a. at Federally-charted banks only.
b. because Congress repealed many of the provisions of deposit insurance regulation.
c. at state-chartered banks, which are less closely regulated than other banks.
d. because the Federal Reserve began to monitor banks less often.
e. because they were insured by the Federal Deposit Insurance Corporation instead of
state agencies.
A market failure in the form of an externality arises when
Strategic trade policy
a. argues for protecting certain industries that benefit society but that may not thrive in a
free trade environment
b. advocates quotas on imports of high-tech products
c. defends the use of tariffs to protect monopolistically competitive industries
d. has been used to justification protection of infant industries
e. explains why less developed countries export more raw materials than services
A credit union is an example of a financial intermediary.
If a firm is operating in a perfectly competitive market in which the market price equals
$12, then its
If labor demand increases, the market wage rate will
a. increase
b. decrease
c. remain stable
d. decrease initially and then rise by a larger amount
e. decrease initially and then rise by a small amount
Which of the following is a definition of the aggregate production function?
a. the relationship describing which inputs an economy can use with different quantities
of labor
b. the relationship describing how much labor an economy can supply with different
quantities of capital
c. the relationship describing how much output an economy can produce with different
quantities of labor
d. the relationship describing what services an economy can produce with different
quantities of capital
e. the relationship describing how much output a firm can produce with different
quantities of capital