Which of the following shows the relationship between national income (GDP) and
total spending?
a. Demand schedule
b. Consumption curve
c. Expenditure schedule
d. Balance schedule
The price of coffee rose 50 percent and coffee sales fell 25 percent. Doughnut sales also
fell 25 percent. From this information we can conclude that
a. demand for coffee is inelastic.
b. coffee and doughnuts are complements.
c. the cross elasticity of demand is minus 0.5 percent.
d. All of the above are correct.
Market economies produce only a few relatively minor defects.
a. True
b. False
The balance sheet of a solvent bank will show
a. assets = liabilities − net worth.
b. assets = liabilities + net worth.
c. net worth = assets + liabilities.
d. liabilities = assets + net worth.
The crowding-in effect depends on the fact that often a decrease in taxes causes a(n)
a. decrease in interest rates and an increase in the price of existing bonds.
b. increase in output, which induces more investment.
c. increase in interest rates and a decrease in the price of existing bonds.
d. decrease in interest rates and the price of existing bonds.
National income and domestic product must be equal.
a. True
b. False
What amount of money was appropriated by Congress for the Troubled Asset Relief
Program?
a. $225 billion
b. $252 billion
c. $700 billion
d. $787 billion
The principal reason why Thailand, Indonesia, and South Korea feared the effects of
appreciation of the U.S. dollar in 1995-1997 was that
a. it would increase exports from these countries and worsen Japanese.
b. it would increase exports from these countries and worsen unemployment.
c. it would decrease exports from these countries since their currencies were tied to the
dollar.
d. it would decrease imports to these countries since their currencies were tied to the
dollar.
Money supply is to income as
a. real is to ideal.
b. stock is to flow.
c. real is to nominal.
d. flow is to stock.