To keep high inflation from eroding the value of money, monetary authorities in the United States
A. control the supply of money in the economy.
B. create token money that is less than its intrinsic value.
C. establish insurance on checkable deposit accounts.
D. make paper money legal tender for the payment of debt.
Answer: A
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The rate of product transformation (RPT) measures the ability of:
a. a consumer to trade one good for another while still maximizing his or her utility. b. a firm to substitute one input for another and still maintain the same production level. c. society to substitute the production of one good for another while still using a fixed supply of inputs efficiently. d. a firm to produce a final good while starting with only natural resources.
In the market for yen, an increase in U.S. real interest rates tends to
A. decrease demand. B. increase equilibrium price. C. increase excess demand. D. cause no change in equilibrium price.
Suppose you are deciding whether or not to increase production. You are currently making a profit. If you produce one more unit, your increase in cost will be $10, your average variable costs will increase to less than that, and your average fixed costs will decrease. Finally, your average revenue will increase to $10, but your increase in revenue will be $10. You should
A. increase production by exactly 1 unit. B. increase production by at least 1 unit. C. leave production unchanged because profit is maximized where you are. D. redo the math associated with decreasing production because that may result in greater profit.
According to the graph shown, the market price is:
A. $15
B. $9
C. $11
D. $20