Growth in potential GDP in the United States is estimated to be about
A) 8.25% per year. B) 5.0% per year. C) 3.2% per year. D) 1.5% per year.
C
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Which of the following statements is an explanation for the law of increasing opportunity costs?
A. In any economy, the state of technology is changing and resources are variable. B. Many economic resources are better at producing one product rather than another. C. The economy is employing all of its available resources. D. The economy is achieving productive efficiency by producing goods at the least cost.
Suppose that the effective return to a U.S. investor from buying a U.K. bond is 5.55%. Forward and spot exchange rates ($/£) are 2.10 and 2.00 respectively. The interest rate on the U.K. bond is most likely equal to:
A) 5.45% B) 5.500% C) 5.650% D) 5.60%
Reserves in the banking system will increase if the Fed:
A. sells euro-dominated bonds and keeps the euros from the sale. B. sells euro-dominated bonds and exchanges the euros for dollars. C. sells euros or buys dollars. D. buys euros or sells dollars.
Kate's money income is $350, the price of X is $4, and the price of Y is $6. Given these prices and income, Kate buys 50 units of X and 25 units of Y. Call this combination of X and Y bundle J. At bundle J, Kate's MRS is 3. At bundle J, if Kate increases consumption of Y by 1 unit, how many units of X can she give up and still reach the same level of utility?
A. 1 B. 3 C. 1/3 D. 2/3