A situation in which both players can adopt moves such that each player’s move is its most profitable response to the move of the other is the
A. prisoner’s dilemma.
B. Nash equilibrium.
C. maximin criterion.
D. tacit collusion.
Answer: B
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For a given nominal exchange rate and foreign price level, an increase in the domestic price level ________ the real exchange rate.
A. offsets any change in B. increases C. may either increase or decrease D. decreases
The economy pictured in the figure has a(n) ________ gap with a short-run equilibrium combination of inflation and output indicated by point ________. 
A. recessionary; A B. recessionary; C C. recessionary; B D. expansionary; A
Refer to the figure below. In response to gradually falling inflation, this economy will eventually move from its short-run equilibrium to its long-run equilibrium. Graphically, this would be seen as 
A. long-run aggregate supply shifting leftward B. Short-run aggregate supply shifting upward C. Short-run aggregate supply shifting downward D. Aggregate demand shifting leftward
Refer to the above table. What does total product equal when 4 units of labor are used?
A) 1328 B) 332 C) 320 D) 960.