How does contractionary monetary policy affect net exports in the short run?
A) Contractionary monetary policy increases exports and reduces imports.
B) Contractionary monetary policy reduces exports and increases imports.
C) Contractionary monetary policy increases exports and increases imports.
D) Contractionary monetary policy reduces exports and reduces imports.
Which of the following would cause an increase in the equilibrium price and an
increase in the equilibrium quantity of watermelons?
A) an increase in demand and an increase in supply
B) an increase in supply
C) an increase in supply and an increase in demand greater than the increase in supply
D) a decrease in demand and an increase in supply
The Difference between the ________ for a good and the ________ is called consumer
surplus.
A) highest price a consumer is willing to pay; lowest price a consumer is willing to pay
B) lowest price a consumer is willing to pay; price the consumer actually pays
C) highest price a consumer is willing to pay; price the consumer actually pays
D) price the consumer actually pays; actual cost to the producer
Figure 27-1
An increase in taxes would be depicted as a movement from ________, using the static
AD–AS model in the figure above.
A) E to B
B) B to C
C) A to B
D) B to A
E) C to D
You’re traveling in Japan and are thinking about buying a new kimono. You’ve decided
you’d be willing to pay $175 for a new kimono, but kimonos in Japan are all priced in
yen. If the exchange rate is 89 yen per dollar, what is the highest price in yen you’d be
willing to pay for a kimono? (Assume no taxes or duties are associated with the
purchase.)
A) 1.97 yen
B) 330.75 yen
C) 15,575 yen
D) 19,425 yen
The process involved in bringing oil to world markets can take years. Substitutes for
oil-based products such as gasoline are limited. As a result
A) the supply of oil is very elastic and the demand for oil is very elastic over short
periods of time.
B) the supply of oil is very inelastic and the demand for gasoline is inelastic over short
periods of time.
C) the supply of oil and the demand for oil shift to the right over short periods of time.
D) the supply of oil and the demand for oil are both perfectly elastic over short periods
of time.
Figure 3-3
The figure above shows the supply and demand curves for two markets: the market for
original Picasso paintings and the market for designer jeans. Which graph most likely
represents which market?
A) Graph B represents the market for original Picasso paintings and Graph A represents
the market for designer jeans.
B) Graph A represents the market for original Picasso paintings and Graph B represents
the market for designer jeans.
C) Graph A represents both the market for original Picasso paintings and designer jeans.
D) Graph B represents both the market for original Picasso paintings and designer
jeans.
The easiest way for a country to obtain access to technology is through
A) subsidizing education and training.
B) promoting foreign direct investment.
C) promoting policies to enhance saving.
D) enacting policies to promote property rights.
A quota
A) makes domestic consumers worse off.
B) makes both domestic producers and consumers better off.
C) makes everyone worse off.
D) makes domestic producers worse off.
Table 27-4
The Fed uses a “core” price index, one that excludes food and energy prices to measure
inflation. It does so because
A) food and energy are inelastic goods and consumers will buy them regardless of their
price.
B) it wants to avoid the blame for high gasoline prices causing inflation.
C) food and energy prices have wide swings that are not related to the causes of general
inflation.
D) food and energy prices do not change all that much during the short run, so are
irrelevant to the calculation of inflation.
As a percentage of GDP, exports are greater than imports for which of the following
countries?
A) the United Kingdom
B) France
C) the United States
D) China
Which of the following could explain why there is an increase in potential GDP but the
equilibrium level of GDP falls?
A) SRAS shifted to the right by more than LRAS.
B) AD shifted to the right by more than SRAS.
C) AD shifted to the right by less than SRAS.
D) AD did not shift and SRAS shifted to the left.
In San Francisco there are many restaurants that specialize in a wide variety of cuisines.
Patronage at these restaurants is influenced by factors such as tastes, price and location.
This market is
A) perfectly competitive.
B) monopolistically competitive.
C) oligopolistic.
D) monopolistic.
A decrease in the price level will
A) shift the short-run aggregate supply curve to the left.
B) shift the short-run aggregate supply curve to the right.
C) move the economy up along a stationary short-run aggregate supply curve.
D) move the economy down along a stationary short-run aggregate supply curve.
If a firm in a perfectly competitive industry experiences persistent losses, in the long
run it should
A) shut down temporarily and wait for market conditions to change.
B) exit the industry.
C) raise its price to cover average total cost.
D) continue to operate if it can raise the demand for its product through advertising and
quality improvements.
Figure 16-3
Chantal owns a hairdressing salon which caters to two main groups of customers:
residents of “The Chateau,” a retirement community, and other residents in the
neighborhood. Figure 16-3 shows the demand curves for the residents of the retirement
community, labeled Market A, and other residents in the neighborhood, labeled Market
B. The demand curves are not identical.
Which group of customers is likely to have a more elastic demand curve (more
sensitive to price)?
A) the other residents of the neighborhood€market B
B) There is no difference in the elasticity of demand between the two groups.
C) the customers from “The Chateau”-market A
D) There is insufficient information to answer this question.
Figure 7-1 Figure 7-1 represents the
market for vaccinations. Vaccinations are considered a benefit to society, and the figure
shows both the marginal private benefit and the marginal social benefit from
vaccinations.
At the efficient equilibrium,
A) economic surplus is maximized.
B) economic surplus is minimized.
C) economic surplus is zero.
D) economic surplus is negative.
What impact does expansionary monetary policy have on the short-run Phillips curve if
consumers and firms expect the expansionary monetary policy to increase inflation?
A) The short-run Phillips curve shifts down.
B) The short-run Phillips curve shifts up.
C) The short-run Phillips curve becomes the long-run Phillips curve.
D) The short-run Phillips curve is not affected by expansionary monetary policy.