Using the quantity equation, if the velocity of money grows at 5 percent, the money
supply grows at 10 percent, and real GDP grows at 4 percent, then the inflation rate will
be
A) 19 percent.
B) 15 percent.
C) 11 percent.
D) 6 percent.
What effect does a depreciation of the dollar have on real GDP in the United States in
the short run?
A) Real GDP will fall.
B) Real GDP will rise.
C) Real GDP will be unaffected by the depreciation of the dollar.
D) Real GDP will be unchanged, but nominal GDP will rise.
Firms in a small economy planned that inventories would grow over the past year by
$500,000. Over that year, inventories did grow by exactly $500,000. This implies that
A) aggregate expenditure that year was equal to GDP that year.
B) there was an unplanned increase in inventories that year.
C) there was an unplanned decrease in inventories that year.
D) aggregate expenditure that year was greater than GDP that year.
Table 9-3
Bryce and Tina are artisans who produce homemade candles and soap. Table 9-3 lists
the number of candles and bars of soap Bryce and Tina can each produce in one month.
Select the statement that accurately interprets the data in the table.
A) Tina has a comparative advantage in making soap.
B) Bryce has a comparative advantage in making soap.
C) Tina has a comparative advantage in making candles and making soap.
D) Neither Bryce nor Tina has a comparative advantage in making soap.
Substantial co-payments are typically not required as a part of the health care system in
A) Canada and the United Kingdom.
B) Japan and Canada.
C) the United States and Japan.
D) Japan and the United Kingdom.
What is the relationship among the following variables in for a perfectly competitive
firm: the market price, average revenue and marginal revenue?
A) Average revenue is equal to the market price; average revenue is greater than
marginal revenue.
B) The market price is equal to both average revenue and marginal revenue.
C) Average revenue is equal to marginal revenue; average revenue is greater than the
market price.
D) As a firm lowers the market price to sell more output, marginal revenue and average
revenue will be less than the market price.
The corporate income tax is ultimately paid by all of the following except
A) owners of the corporation.
B) the corporation’s debtors in the form of lower rates of return on the corporation’s
bonds.
C) customers in the form of higher prices.
D) employees in the form of lower wages.
Actual real GDP will be above potential GDP if
A) firms are producing below capacity.
B) firms are producing at capacity.
C) firms are producing above capacity.
D) inflation is rising.
In 2011, Microsoft filed a complaint with the European Commission accusing Google
of taking steps to monopolize the Internet search engine business. Microsoft’s primary
complaint was that
A) Google is the only Internet search engine available to Windows operating system
users.
B) the European Union contracts exclusively with Google for its Internet search engine
use.
C) Google was using its dominant position as an Internet search engine to exclude
competitors.
D) Google owns the Internet advertising companies that pay for ads on search engine
sites, and has prohibited ads from being sold to competitors.
Under the Bretton Woods exchange rate system, the U.S. government agreed to buy or
sell gold at a fixed price of ________ per ounce.
A) $1
B) $35
C) $100
D) $400
Table 8-18
A very simple economy produces three goods: cameras, legal services, and books. The
quantities produced and their corresponding prices for 2008 and 2013 are shown in the
table above.
What is real GDP in 2013, using 2013 as the base year?
A) $28,885
B) $11,790
C) $11,200
D) $10,275
In October 2005, the U.S. Fish and Wildlife Service banned the importation of beluga
caviar, the most prized of caviars, from the Caspian Sea. What happened in the market
for caviar in the U.S.?
A) The supply curve shifted to the left.
B) The supply curve shifted to the right.
C) The demand curve shifted to the right.
D) The demand curve shifted to the left.
Figure 18-1
The appreciation of the euro is represented as a movement from
A) D to A.
B) D to C.
C) B to C.
D) A to C.
E) A to B.
The public choice model can be used to examine voting models that contrast the
manner in which collective decisions are made by governments (state, local and federal)
and the manner in which individual choices are made in markets. Which of the
following descriptions is consistent with the difference between collective
decision-making and decision-making in markets?
A) Everyone who votes must agree with a decision made collectively through
government, but in markets individuals can make their own choices.
B) Individuals are less likely to see their preferences represented in the outcomes of
government policies than in the outcomes of markets.
C) The cost of a government policy is determined by a majority vote of members of the
public; decisions made in markets are based on individual willingness to pay.
D) Choices made through government policies are more important than decisions
individuals make through markets.