The economy is currently on its production possibilities frontier (PPF). A politician says that it is possible to get more of everything---more infrastructure, more schools, more national defense, more spending on social programs, and so on. The politician is
A) correct if he is assuming a rightward-shifting PPF.
B) incorrect if he is assuming a rightward-shifting PPF.
C) incorrect if he is assuming a PPF that does not change.
D) correct if he is assuming a PPF that does not change.
E) a and c
E
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Which of the following will reduce consumer expenditures?
A) a decrease in expected future income B) a decrease in interest rates C) a decrease in the price level D) a general increase in housing prices
In economics, interest refers to all of the following EXCEPT
A) the payment for current rather than future command over resources. B) the cost of obtaining credit. C) the return paid to owners of financial institutions. D) the return paid to the owners of capital.
Adopting the Single European Act had broad popular support; the Treaty on European Union was more controversial
Indicate whether the statement is true or false
Related to the Economics in Practice on page 102: Frank runs a corner delicatessen and one day decides to raise his prices by 10 percent. Total revenue is likely to ________ at the end of the first month of the higher prices since demand is relatively elastic in the ________ term.
A. rise; short B. rise; long C. fall; long D. fall; short