When the supply of Swiss cheese decreases while the demand for Swiss cheese increases, the equilibrium ________ of Swiss cheese will definitely ________, ceteris paribus.
A. price; increase
B. price; decrease
C. quantity; increase
D. quantity; decrease
Answer: A
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The leader of the monetarist school and major proponent of a monetary growth rule was
A) Ben Bernanke. B) Paul Volcker. C) Milton Friedman. D) Alan Greenspan.
Refer to the above figure. The points between A and B are known as
A) a peak. B) a trough. C) an expansion. D) a contraction.
Economists believe that people respond in a predictable way to changes in costs and benefits. The term that best describes this phenomenon is
a. opportunity cost b. scarcity c. innovation d. marginal analysis e. other things equal (or ceteris paribus)
Can the U.S. dollar and the European euro both appreciate relative to each other?
a. Yes, both countries can gain in this manner. b. Yes, provided the central banks permit it. c. No, unless there is a system of fixed exchange rates. d. No, if one currency appreciates, the other must depreciate.