In Figure 3-2, a point such as D
A. cannot be obtained with the current level of resources and technology.
B. can never be obtained.
C. can only be obtained by a capitalist society.
D. represents a misallocation of resources.
Answer: A
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If aggregate planned expenditures are less than real GDP, then
A) inventories increase above their planned levels and businesses increase their production. B) unplanned inventory changes equal zero. C) inventories decrease below their planned levels and businesses increase their production. D) inventories increase above their planned levels and businesses decrease their production. E) there is no equilibrium level of real GDP.
Which of the following statements is true? a. If the Fed chooses a money supply target, it runs the risk of interest rate variations that may create a new set of problems
b. The Fed can target the interest rate and money supply at the same time but only during periods of inflation. c. If the Fed chooses a money supply target, it runs the risk of money supply variations that may create a new set of problems. d. The Fed can target the interest rate and money supply at the same time but only during recessions. e. If the Fed chooses an interest rate target, it reduces the risk of money supply variations.
A principal disadvantage of conventional checking accounts compared to money market mutual funds is that checking accounts
a. are less liquid. b. often do not pay interest. c. cannot be used as a store of value. d. are not insured by deposit insurance.
A decrease in the price of a complement will shift the demand curve for a good to the left
a. True b. False Indicate whether the statement is true or false