Refer to Figure 15-9. In the figure above suppose the economy is initially at point A. The movement of the economy to point B as shown in the graph illustrates the effect of which of the following policy actions by the Federal Reserve?
A) an increase in the required reserve ratio B) a decrease in income taxes
C) an open market sale of Treasury bills D) an open market purchase of Treasury bills
D
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The figure above represents the relationship between output and cost in an industry with an external cost. When output is at D, what distance represents the marginal external cost?
A) AB B) BC C) CD D) BD E) None of the above answers is correct.
The capital stock increases whenever
A) gross investment is exceeds net investment. B) net investment exceeds gross investment. C) gross investment is negative. D) net investment is positive.
A(n) ________ of a nation's currency will cause imports to ________ and exports to ________, all other things held constant
A) depreciation; increase; decrease B) appreciation; decrease; increase C) depreciation; decrease; increase D) appreciation; increase; increase E) depreciation; decrease; decrease
Which of the following is a positive statement?
a. An unemployment rate of 7 percent or higher is a national disgrace. b. Unemployment is a less important problem than inflation. c. When the national unemployment rate is 7 percent, the unemployment rate for inner-city youth is often close to 40 percent. d. Unemployment and inflation are equally important problems. e. An inflation rate of 7 percent is too high.