If inflation is slow to change after an increase in the growth rate of spending, then:
A. real growth must decrease.
B. real growth must increase.
C. interest rates must decrease.
D. interest rates must increase.
Answer: B. real growth must increase.
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If the total cost incurred in hiring ten workers by a firm is $45, and the total cost incurred when the eleventh worker is hired is $60, the marginal cost of hiring the eleventh worker is:
A) $20. B) $15. C) $105. D) $1.33.
If the demand for jelly decreases, and the price of grapes (used to make jelly) rises
A) the equilibrium price of jelly falls and the equilibrium quantity of jelly might rise or fall. B) the equilibrium price of jelly rises and the equilibrium quantity of jelly might rise or fall. C) the equilibrium price of jelly might rise or fall, and the equilibrium quantity of jelly falls. D) the equilibrium price of jelly might rise or fall, and the equilibrium quantity of jelly rises.
Suppose the production function for coffee (C) is C = min(B,W), where B = beans in pounds and W = water in gallons. Suppose the price of water is $.10 per gallon and the price of beans is $10 per pound. The expansion path is
a. B = 10W b. B = .1W c. B = W d. ?10 = B + W
When a $1,000 check written on the Chase Bank is deposited in an account at the Bank of America the:
a. Liabilities of Chase rise by $1,000. b. Reserves of Chase increase by $1,000. c. Liabilities of the Bank of America fall by $1,000. d. Reserves of the Bank of America increase by $1,000. e. All the above.