A point inside a society's production possibilities curve represents
A. a technically superior output combination.
B. an underutilization of productive resources.
C. an output combination that satisfies the needs of the population.
D. an unattainable combination of outputs.
Answer: B
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Refer to Figure 23-2. If the U.S. economy is currently at point N, which of the following could cause it to move to point K?
A) Government expenditures increase. B) Firm's cash flows rise as profits rise. C) Households expect future income to rise. D) Household wealth falls.
Unequal pay that is caused by economic discrimination will be due to
A) a noneconomic factor. B) differences in the marginal revenue product. C) a monopolistic labor market. D) difference in human capital.
In practice, money supply and short-term interest rates are determined by the
a. Treasury and Commerce departments. b. Federal Open Market Committee. c. Board of Governors. d. House and Senate.
The default-risk premium:
A. should vary directly with the bond's yield and the bond's price. B. should be lower for a highly speculative bond than for an investment-grade bond. C. should vary directly with the bond's yield and inversely with its price. D. is less than 0 (zero) for a U.S. Treasury bond.