Refer to the information provided in Figure 2.4 below to answer the question(s) that follow.
Figure 2.4According to Figure 2.4, as the economy moves from Point B to Point D, the opportunity cost of motorcycles, measured in terms of hybrid cars,
A. increases
B. remains constant.
C. initially increases, then decreases.
D. decreases.
Answer: A
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In the above figure, the most efficient way to produce 15 units is to hire
A) 2 workers. B) 3 workers. C) 4 workers. D) 5 workers.
If the federal funds rate were above the level the Federal Reserve had targeted, the Fed could move the rate back towards its target by
a. buying bonds. This buying would increase the money supply. b. buying bonds. This buying would reduce the money supply. c. selling bonds. This selling would increase the money supply. d. selling bonds. This selling would reduce the money supply.
Economists measure the price level
A. by keeping track of nominal GDP. B. using a price index. C. by measuring the growth rate in money supply. D. by measuring the growth rate in real GDP.
A temporary decrease in the price of oil would be considered a:
A. long-run supply shock. B. demand shock. C. short-run supply shock. D. The changing price of oil would not affect any of these.