As a strategy to boost enrollment, in January 1996, a private college in Iowa offered free tuition for graduating high school seniors from the county where it is located. For students who accepted the offer, how did this offer affect the opportunity cost of attending college?
A. The opportunity cost did not change, since lost earnings were still a factor.
B. The opportunity cost became zero for the typical student.
C. The opportunity cost was very low, because the only cost was for books and supplies.
D. The opportunity cost did not change, since tuition was not a factor in computing opportunity cost.
E. The opportunity cost was lower than if tuition was charged, but there was still a cost.
Answer: E
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The Fed
A) distributes Federal Reserve notes, which are paper currency. B) is responsible for conducting U.S. fiscal policy. C) has 15 Federal Reserve banks and governing boards in New York and Chicago. D) is responsible for minting coins.
Following World War II, the U.S. and most developed countries adopted a system of fixed exchange rates known as:
a. the Heller plan. b. the new gold standard. c. the Bretton Woods system. d. the Geneva accord.
Which of the following policies would be advocated by someone who wants the government to follow an active stabilization policy when the economy is experiencing severe unemployment?
a. decrease the money supply b. increase government expenditures c. increase taxes d. All of the above are correct.
Refer to the table. Per capita GDP was about:
A. $105 in year 3 in Alta.
B. $303 in year 3 in Zorn.
C. $200 in year 1 in Zorn.
D. $5 in year 2 in Alta.