If the price of a soda was 15 cents in 1970, when the CPI was 50, and 50 cents in 2007, when the CPI was 172, then
A) the price of the soda was greater in real value in 1970 than in 2007.
B) prices on average have increased 567 percent.
C) the price of a soda has increased a greater percentage than the CPI.
D) prices on average have increased 244 percent.
E) the real price of a soda is the same in 1970 and 2007.
A
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In the above table, if the market is perfectly competitive and unregulated, at the equilibrium level of output, the marginal external benefit per unit is
A) zero. B) $20 per unit. C) $50 per unit. D) $70 per unit.
Suppose that each worker must use only one shovel to dig a trench, and shovels are useless by themselves. In the long run, the firm will experience
A) increasing returns to scale. B) constant returns to scale. C) decreasing returns to scale. D) The returns to scale cannot be determined from the information provided.
Credit card balances are not considered to be money primarily because they:
A. are not part of people's wealth. B. are an asset used in making transactions. C. are rarely used to make purchases. D. do not represent an obligation to pay someone else.
The oversimplified money multiplier formula, when the required reserve ratio is m, is
A. change in money supply = change in reserves × m. B. change in money supply = (1 / m) / change in reserves. C. change in money supply = (1 / m) × change in reserves. D. change in money supply = m / change in reserves.