A country can consume outside its production possibilities curve by trading.
Answer the following statement true (T) or false (F)
True
A country can consume beyond its production possibilities due to the fact that the country can purchase what it needs abroad for a lower cost than it can produce the goods on its own, allowing it to consume more.
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During this year, Barbara earned $60,000 as a financial analyst, paid taxes of $5,000 and consumed $53,000. If Barbara's wealth was $4,000 at the beginning of the year, at the end of the year Barbara's wealth was
A) $6,000. B) $60,000. C) $2,000. D) $4,000. E) $5,000.
When an economy experiences deflation, consumption will:
A. decrease, because people will want to wait for prices to drop before spending. B. increase, because people will want to wait for prices to drop before spending. C. decrease, because people will lose value in their savings. D. increase, because people will lose value in their savings.
An annually balanced federal budget
A. enables fiscal policy to be implemented in a timely and selective manner, without the drag on consumption and saving that is usually associated with federal borrowing. B. essentially eliminates the use of fiscal policy for stabilizing the economy. C. could bring the economy up to full employment if a deflationary GDP gap exists. D. would reduce tax collections, thereby stimulating aggregate demand.
To sell more units, a monopolist
A) simply moves across its horizontal demand curve to a larger quantity. B) moves down its demand curve to a lower price that will increase quantity demand. C) can continue to receive the same price it always has as long as it has its customers' goodwill. D) must be willing to lower the barriers to entry that have protected it.