On a production possibilities curve, the optimal or best combination of output for any society:
A. depends upon the preferences of society.
B. is at a point near the bottom of the curve.
C. is at the precise midpoint of the curve.
D. is at a point near the top of the curve.
Answer: A
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It is __________ in the United States for a bank to require a business owner to put up some of his personal assets as "__________" collateral for a loan to his business
A) legal; inside B) legal; outside C) illegal; inside D) illegal; outside
Suppose you are the president of a large bank. In which situation would you be most reluctant to loan money to a country?
a. Its nominal debt is $10 trillion. b. Its nominal debt is 1 percent of nominal GDP. c. Its nominal deficit is $150 billion. d. Its real deficit is 100 percent of real GDP. e. Its real debt is 1 percent of real GDP.
Which one of the following statements is NOT correct?
A. The natural rate of unemployment is estimated to be between 5 percent and 6.5 percent in the U.S. B. The term "full employment" means that 100 percent of the labor force is employed. C. The line between frictional and structural unemployment is sometimes hard to draw. D. Unemployment can occur even when an economy is growing.
According to some New Keynesian theories, one possible rationale for active policy making is
A. flexible prices. B. growing competition in U.S. product markets. C. people are not rational and so do not react to incentives. D. sluggish adjustment of the price level in response to changes in aggregate demand