Real business cycle theory states that the most important cause of business cycles is
A) shocks to the money supply.
B) interest rate shocks.
C) Federal Reserve policy decisions.
D) shocks to tastes and technology.
D
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The strength of the competition faced by a company can profoundly affect its
A. pricing. B. output decisions. C. input decisions. D. All of the responses are correct.
A professor spends 10 hours per day giving lectures and writing papers. For the professor, a graph that shows his various possible mixes of output (lectures given per day and papers written per day) is called his
a. line of tastes. b. trade-off curve. c. production possibilities frontier. d. consumption possibilities frontier.
Economics is the study of how people:
A. vote for political leaders. B. make choices to produce and consume goods and services. C. establish social institutions that maximize well-being. D. develop value systems.
Which of the following is NOT a positive statement?
A) The unemployment rate is 5.8 percent. B) The inflation rate for 2002 was 2.3 percent. C) The national debt is too high. D) The federal government budget for 2004 is $2.2 trillion.