When a temporary beneficial supply shock hits a small open economy, it causes the current account to ________ and investment to ________
A) fall; fall
B) rise; remain unchanged
C) fall; remain unchanged
D) rise; fall
B
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When the power company decides to use manpower to bury its lines, it directly answers the ________ question
A) what B) for whom C) how D) why E) when
When comparing the velocity of M2 (V2), with the velocity of M1 (V1), the evidence suggests that V2 has been __________ and V1 has been __________ over time
A) relatively predictable; relatively predictable B) relatively predictable; relatively unpredictable C) relatively unpredictable; relatively predictable D) relatively unpredictable; relatively unpredictable
The difference between the Keynesian and classical labor supply functions is that in the Keynesian version
a. workers know the real wage while in the classical system workers must form an expectation of the price level. b. workers must form an expectation of the price level while the workers know the real wage in the classical system. c. workers are assumed to be interested in the money wage while in the classical version workers know the real wage. d. labor supply depends on the actual real wage while labor supply depends on the expected real wage in the classical system.
Having seen the quantity of drugs supplied by pharmaceutical companies in a competitive market, a government decides to force companies to sell exactly the same quantity of drugs at prevailing market prices
The government then forbids additional drug sales and allows doctors to prescribe the drugs at no cost to patients in need. This government scheme is A) efficient as the quantity of drugs traded is the same as under a free market. B) efficient as the price of drugs paid by the government is the same as under a free market. C) efficient as consumer surplus is maximized. D) likely to be inefficient as doctors are unlikely to prescribe drugs to the consumers who are willing to pay the most for the drugs. E) likely to be inefficient as drug producers have a captive buyer.