The self-correcting property of the economy means that output gaps are eventually eliminated by:
A. increasing or decreasing potential output.
B. government policy.
C. decreasing inflation only.
D. increasing or decreasing inflation.
Answer: D
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When the marginal cost curve lies below the average cost curve, ________
A) the marginal cost curve is vertical B) the marginal cost curve is horizontal C) the average cost curve slopes downward D) the average cost curve slopes upward
The theory of efficient markets implies:
A. expectations do not play a role in stock prices because this isn't real information. B. the price at which stocks currently trade only reflect past information. C. the chartists are in fact correct that there are patterns in stock prices. D. stock prices should be highly unpredictable.
Which of the following is the best example of economic investment?
A. Apple builds a new plant to manufacture iPads B. Your college purchases a 5-year old building in order to have more classrooms C. A retiree purchases U.S. government bonds D. A company like Bank of America acquires another company like Merrill Lynch
A. Everything else remaining unchanged, what is likely to happen to the demand curve for coffee workers if:
i. there is a fall in the price of coffee. ii. there is an increase in the wage rate. iii. there is a rise in the price of coffee seeds. iv. a new fertilizer that increases the productivity of coffee farmers is invented. b. Everything else remaining unchanged, what is likely to happen to the supply curve of female workers if: i. the opportunity cost of working outside home decreases. ii. there is an increase in the wage rates.