Kate takes a part-time job and the sacrifice of study time causes her grade point average to fall from 3.5 to 2.9 . Assume that the grade point average would have stayed at 3.5 if study time had not been reduced. The opportunity cost of having taken the job is the
a. cost of tuition
b. 3.5 grade point average
c. 0.6 decrease in the grade point average
d. 2.9 grade point average
e. money earned from the part-time job
C
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The self-correcting tendency of the economy means that rising inflation eventually eliminates:
A. unemployment. B. exogenous spending. C. recessionary gaps. D. expansionary gaps.
If the exchange rate rises, the quantity of dollars demanded
A) increases and there is movement down along the demand curve for dollars. B) decreases and there is movement down along the demand curve for dollars. C) decreases and there is movement up along the demand curve for dollars. D) increases and there is movement up along the demand curve for dollars. E) does not change.
In which model does there exist a tradeoff between higher inflation and lower unemployment?
a. monetarist b. real business cycle. c. new classical d. a and b. e. a tradeoff exists in all of the above.
Assume the government purposely incurs a budget deficit that is financed by borrowing. As a result, interest rates rise and the amount of private investment spending declines. This illustrates:
A. the equation-of-exchange effect. B. the crowding-out effect. C. the paradox of thrift. D. the wealth effect.