Which of the following events would cause a rightward shift in the market supply curve for automobiles?
A. A technological improvement that reduces the cost of production.
B. A decrease in the number of sellers.
C. An increase in the wages of autoworkers.
D. A higher sales tax on automobiles.
Answer: A
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Determinants of income differences include all of the following EXCEPT
A) age. B) marginal productivity. C) moral hazard. D) discrimination.
US law was recently changed so that some airplane manufacturers are immune from liability from accidents involving their decades old aircraft, laying all the responsibility on the pilots. As a result
a. accident rates fell due to less adverse selection b. accident rates fell due to less moral hazard c. accident rates rose due to less adverse selection d. accident rates rose due to less moral hazard
Which of the following will lead to an increase in aggregate demand in the United States?
a. a higher price level b. an increase in the real interest rate c. an increase in wealth due to a substantial appreciation in the value of stocks d. a decrease in real income in Japan and Western Europe
Suppose that Argentina's dollar-denominated external assets and liabilities are $10 billion and $100 billion, respectively, and its Argentine peso-denominated external assets and liabilities are each 50 billion pesos (P). Suppose further that Argentina fixes its exchange rate at P1 = $US1. What is the likely effect of the change in Argentina's external wealth on Argentine aggregate demand as a result of the devaluation of the peso (from P1 = $US1 to P3 = $US1)?
A) It will increase Argentine aggregate demand. B) It will decrease Argentine aggregate demand. C) It will neither increase nor decrease Argentine aggregate demand. D) It will first increase, then decrease Argentine aggregate demand.