If the economy were producing at point E and moves to point D,
Hypothetical Production Schedule for a Two-Product Economy
A. resources will shift from producing capital goods to producing consumer goods.
B. resources will shift from producing consumer goods to producing capital goods.
C. more capital goods can be produced without any sacrifice in consumer goods production.
D. more consumer goods can be produced without any sacrifice in capital goods production.
B. resources will shift from producing consumer goods to producing capital goods.
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At the beginning of 2015, a country is at full-employment. During 2015, oil-producing countries decrease oil production leading to much higher oil prices. The higher oil prices can
A) increase aggregate demand and lead to an expansion. B) increase aggregate supply and lead to an expansion. C) decrease aggregate demand and lead to a stagflation. D) decrease aggregate supply and lead to a stagflation. E) decrease aggregate demand and lead to a higher price level.
If reckless drivers are more likely to buy automobile insurance than safe drivers are,
A) a moral hazard has occurred. B) adverse selection has occurred. C) the market for insurance is efficient. D) then automobile insurance will be fairly priced.
Which of the following sayings describes the concept of diminishing marginal utility?
a. time is money b. penny wise and pound foolish c. absence makes the heart grow fonder d. a penny saved is a penny earned e. a fool and his money are soon parted
Lowering the reserve ratio:
A. Increases the total reserves in the banking system B. Also reduces the discount rate C. Turns required reserves into excess reserves D. Reduces the amount of excess reserves the banks keep