The primary reason that short-lived shocks can have long-run effects is
A. the presence of propagation mechanisms.
B. the nonneutrality of money.
C. misperceptions by the public over the actual price level and the expected price level.
D. the presence of rational expectations among the public.
Answer: A
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What is the more efficient choice: sending one's child to John Q. Public High School at zero dollar tuition or to Purebred Prep School at several thousand dollars a year?
A) High school, because it's much cheaper. B) Prep school, because it's much higher in quality of instruction. C) Prep school, because what matters most is not what you know, but who you know. D) It depends on the decision makers' own evaluations of cost and benefit.
Figure 10-1
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If the profit-maximizing firm depicted in Figure 10-1 is perfectly competitive, how much output should it produce?
A. A B. B C. C D. D
Regulation that intends to improve the quality of service provided by carpenters will tend to increase the price of their services
a. True b. False
Heartland and Soulland) The country with a comparative advantage in the production of drill presses is:
A) Heartland. B) Soulland. C) neither; they both use the same technology. D) neither; they both use the same amount of resources.