Evaluate the Argentinean Convertibility Law of April, 1991
What will be an ideal response?
Good idea in the short run, catastrophic idea in the long run. The law was abandoned only in January 2002.
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According to Okun's Law, the year-to-year change in the rate of unemployment is ________ if the annual growth rate of real GDP is 5%
A) -5% B) 5% C) 2% D) -1%
Sandy is a big Star Wars fan and buys a $20 ticket a week in advance to the premier of the new movie. After arriving at the theater, she realizes she left the ticket at home and doesn't have time to return home and get it. Sandy can buy another ticket for $20. She decides not to because seeing the movie isn't worth $40 to her. This is an example of:
A. rational behavior because she values the movie less than $40 B. irrational behavior because she really values the movie more than $40 C. irrational behavior because the initial $20 is a sunk cost. D. rational behavior because it is a commitment device to never forget a ticket at home again.
When the price of a good falls, consumers buy more of the good because it is cheaper relative to competing goods. This statement describes the:
a. consumer equilibrium effect. b. price effect. c. income effect. d. substitution effect.
The maximum possible production of goods and services generated by the fullest employment of the economy's resources is
a. impossible to achieve b. an unrealistic goal seldom achieved c. economic efficiency d. a point above the production possibilities curve e. possible only if the production possibilities curve shifts inward