Which of the following is a factor of production?
A) an acre of forested land
B) a U.S. Treasury bond
C) 20 shares of Ford stock
D) $25,000 in cash
Answer: A
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Refer to Figure 6-2. The absolute value of the price elasticity of demand at points a and b is 1. What is the value of Pb?
A) $50 B) $40 C) $30 D) $20
Which of the following would contribute, directly or indirectly, to a deficit in the capital account of the U.S. balance of payments?
a. A British citizen buys stock in Ford. b. A British citizen buys a bond from Ford. c. Interest rates fall in the United States relative to their level in the rest of the world. d. Australian publisher Rupert Murdoch buys The New York Times. e. Developing countries become more stable and so borrow less from U.S. banks.
An economy produces 1,000,000 computers valued at $2,000 each. Households purchase 200,000 computers, of which 100,000 are imported. Businesses purchase 300,000 domestically produced computers, the government purchases 300,000 domestically produced computers, and 100,000 domestically produced computers are sold abroad. At the end of the year, the computer manufacturers hold the unsold computers in inventory. What is the value of the investment component of GDP?
A. $1.0 billion B. $0.9 billion C. $0.8 billion D. $0.6 billion
Economists who believe in activist policymaking argue that
A. only planned changes in the money supply impact the economy. B. decreases in aggregate demand definitely impact the economy in the short run. C. decreases in aggregate demand impact the economy only in the long run. D. only increases in the minimum wage levels improve economic well-being.