Refer to the information provided in Figure 7.9 below to answer the question(s) that follow. 
Figure 7.9Refer to Figure 7.9. The slope of isocost AB is
A. -1.
B. 0.
C. 1.
D. indeterminate from this information, as the prices of capital and labor are not given.
Answer: A
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Based on the above table, an open market operation in which the Fed purchased $100,000 of government securities would
A) lead to a maximum potential expansion of the money supply of $1 million. B) create a reserve deficiency for the banking system. C) cause demand deposits to fall by $100,000. D) lead to a maximum potential expansion of the money supply of $100,000.
A high marginal tax rate reduces work incentives
Indicate whether the statement is true or false
Which of the following is not a result of a higher federal budget deficit?
A) a higher real interest rate B) a depreciation of the currency C) a fall in exports D) a fall in the price of foreign inputs
Total expenditures on a company's product will be largest when it is priced such that the elasticity of demand:
A. equals -1. B. is greater than -1. C. is less than -1. D. equals 0.