A temporary decrease in the price of oil would be considered a:
A. long-run supply shock.
B. demand shock.
C. short-run supply shock.
D. The changing price of oil would not affect any of these.
Answer: C
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In the production possibilities frontier depicted in the figure above, which of the following combinations of hats and bananas is inefficient?
A) 4 million pounds of bananas and 4 million hats B) 2 million pounds of bananas and 5 million hats C) 0 pounds of bananas and 6 million hats D) 1 million pounds of bananas and 3 million hats
The increase in the demand for widgets, shown in the figure above, is the result of a decrease in the price of McBoover devices. Therefore
A) widgets and McBoover devices are substitutes. B) widgets and McBoover devices are complements. C) widgets are a normal good. D) McBoover devices are a normal good.
M2
What will be an ideal response?
Which of the following is used to measure directly the average standard of living across countries?
A. Real GDP. B. Nominal GDP. C. Purchasing power parity. D. GDP per person.