In Figure 3-2, a point such as A
A. is preferable over B.
B. is an efficient use of resources.
C. represents a misallocation of resources.
D. is not obtainable.
Answer: B
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A below-full-employment equilibrium
A) is not possible in the U.S. economy. B) occurs when real GDP is less than potential GDP. C) occurs when the price level is rising very quickly. D) occurs when real GDP exceeds potential GDP.
In a Mexican factory, each worker can produce 1/8 of a vase or 1/16 of a statue per hour. If there are 400 workers at the factory, the opportunity cost of one statue is
a. 1/2 of a vase b. 1/8 of a vase c. 8 vases d. 16 vases e. 2 vases
Diseconomies of scale are associated with:
A. a downward-sloping long-run average cost curve. B. an upward-sloping long-run average cost curve. C. an upward-sloping short-run average cost curve. D. a downward-sloping short-run average cost curve.
Which of the following statements about unemployment that is indicative of sectoral shifts hypothesis is not correct?
A. Unemployment spells will be longer the more firm-specific and industry-specific skills are. B. When an industry experiences a negative shock, those workers who become unemployed will eventually become employed in new industries after they adjust their skills to match the needs of new, growing industries. C. Unemployment rates for sectoral shifts reasons will vary by industry and occupation. D. When an industry experiences a negative shock, those workers who become unemployed will eventually become employed in new industries when the new industries adjust their needs to the existing skills of the unemployed. E. All of these are indicative of the sectoral shifts hypothesis.