When the housing bubble popped, the effect of the negative demand side shock and the negative supply side shock were the same on:
A. output, causing it to definitely decrease.
B. prices, causing them to definitely rise.
C. output, causing it to definitely increase.
D. prices, causing them to definitely fall.
Answer: A
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Under the gold standard, a country experiencing a fall in its gold reserves was supposed to:
(a) Expand loans (b) Buy securities (c) Lower discount rates (d) Cut loans
A business incurs the following costs per unit: Labor - $5/unit; Materials $3/unit and rent - $5000/month. If the firm produces 100 . units a month, the total variable costs equals
a. $5,000 b. $8,000 c. $13,000 d. $10,000
Economists typically suggest three choices that allow a polluter to decide how to absorb most, or perhaps all, of the social costs of its actions, which are
A) continuing to overproduce the good, lowering the price of the good, or cutting output. B) reducing the pollution-causing activity, changing production techniques, or paying a price to pollute. C) installing pollution abatement equipment, paying to pollute, or just ignoring the issue. D) paying a pollution tax, continuing to use existing production techniques, or continuing the polluting behavior without regard to the social implications.
The two main causes of an asset price bubble are:
A. herding and budget deficits. B. herding and budget surpluses. C. budget surpluses and leverage. D. herding and leverage.