Consider a production possibility frontier with jeans on the vertical axis and shoes on the horizontal axis. As the country moves along the frontier closer to the horizontal axis,
A) free lunches occur.
B) more shoes are produced.
C) more tradeoffs occur.
D) more jeans are produced.
E) the country eventually chooses an unattainable point.
B
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Use the following graph to answer the next question.
Suppose the economy is currently in equilibrium at the full-employment real GDP level of Q2.and price level of P2. If an event occurred in the economy that triggered demand-pull inflation, we would expect
A. the price level to move toward P3, and the output level to move toward Q3, B. the price level to move toward P3, and the output level to remain constant. C. the price level to move toward P1, and the output level to move toward Q1, D. the price level to move toward P1, and the output level to remain constant.
The direct effect of an increase in the money supply is to
A) raise interest rates as people increase their saving. B) decrease aggregate demand as people anticipate future economic problems. C) increase interest rates as people anticipate higher inflation in the future. D) increase aggregate demand as people try to spend their excess money balances.
Two important considerations during the difference-in-difference approach are
a. Representativeness, Reflectiveness b. Injections, Leakages c. Representativeness, Leakages d. Reflectiveness, Injections
If the price of used automobiles increased dramatically relative to all other prices, and the demand for all goods remained the same, which of the following would most likely occur?
a. The GDP price index would decrease less than the CPI. b. Both the GDP price index and the CPI would decrease. c. The GDP price index would increase more than the CPI. d. The CPI would increase more than the GDP price index. e. Both the GDP price index and the CPI would increase by the same amount.