Refer to the information provided in Figure 7.9 below to answer the question(s) that follow. 
Figure 7.9Refer to Figure 7.9. The slope of isocost AB is
A. -1.
B. 0.
C. 1.
D. indeterminate from this information, as the prices of capital and labor are not given.
Answer: A
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If the interest rate is above its equilibrium value, the price of
a. bonds will fall b. real estate will rise c. bonds will rise d. stocks will fall because of fluctuations in the bond market e. money will rise
According to dynamic tax analysis, will continuing to push up the tax lead to steady increases in tax revenues? Why?
What will be an ideal response?
Changes in the federal funds rate:
A) change the long-run expected interest rates in the same direction. B) change the long-run expected interest rates in the opposite direction. C) can change the long-run expected interest rate either in any direction depending on the magnitude of the change in the federal funds rate. D) have no effect on the long-run expected interest rate.
As the money wage rate increases,
A) potential GDP increases. B) potential GDP decreases. C) aggregate supply increases. D) aggregate supply decreases. E) aggregate supply and potential GDP do not change.