Loans made between borrowers and lenders are:
A. not part of either parties' assets or liabilities until the loans are repaid.
B. assets to the lenders and liabilities of the borrowers since the promises are made to the lenders.
C. liabilities to the lenders and assets to the borrowers since the borrower obtains the funds.
D. liabilities to both the lenders and the borrowers.
Answer: B
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Refer to Table 2-5. Assume Nadia's Neckware only produces ascots and bowties. A combination of 8 ascots and 18 bowties would appear
A) along Nadia's production possibilities frontier. B) inside Nadia's production possibilities frontier. C) outside Nadia's production possibilities frontier. D) at the horizontal intercept of Nadia's production possibilities frontier.
A tax wedge is ________
A) the difference between the tax rate on income and capital gains B) equal to the difference between what people earn before and after taxes are accounted for C) the size of the decrease in labor force participation when labor income is taxed D) the difference between the rate on Treasury securities and the income tax rate
The best price index to use in calculating real GDP is
A. The PPI. B. The CPI. C. Any of the indexes because they all reflect price level changes. D. The GDP deflator.
Refer to the information provided in Figure 7.6 below to answer the question(s) that follow. 
Figure 7.6Refer to Figure 7.6. If the price of capital is $20 and the price of labor is $10, the optimal product technique is
A. A. B. B. C. C. D. D.