Which of the following is not a part of the scientific method in economics?
a. normative statements
b. comparing predictions to evidence
c. formulating a hypothesis
d. a hypothesis
e. behavioral assumptions
A
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Recessions in the U.S. economy show up in economic data as periods of
A) declining prices. B) rising interest rates. C) slower growth or actual decline in nominal GDP. D) slower growth or actual decline in real GDP.
A car leasing company that expands its size by buying its competitors may run the risk of increasing production cost per unit due to:
a. diseconomies of scale. b. economies of scale. c. diminishing returns. d. greater use of large-volume purchases.
In the aggregate expenditures model, if an economy operates below equilibrium GDP, there will be:
a. unplanned inventory depletion. b. unplanned inventory accumulated. c. a decrease in GDP. d. a decrease in employment.
If U.S. citizens decide to purchase more foreign assets at each interest rate, the U.S. real interest rate
a. increases, the real exchange rate of the dollar appreciates, and U.S. net capital outflow decreases. b. increases, the real exchange rate of the dollar depreciates, and U.S. net capital outflow increases. c. decreases, the real exchange rate of the dollar depreciates, and U.S. net capital outflow decreases. d. decreases, the real exchange rate of the dollar appreciates, and U.S. net capital outflow increases.