Cross country data illustrates that rapid expansion in the supply of money over a lengthy period of time (for example, a decade) leads to
a. rapid growth of real output.
b. a low real rate of interest.
c. high rates of inflation.
d. an inflow of capital and a high rate of investment.
C
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Answer the following statement(s) true (T) or false (F)
1. The major reason education leads to higher wages is due to signaling. 2. Attending college can be seen as an individual’s attempt to raise their level of human capital. 3. Since mowing ones lawn is not done at their workplace, it is viewed as a use of their leisure time and thus (somewhat paradoxically) falls into the category of leisure. 4. One deficiency of labor-leisure indifference curve analysis is that because indifference curves are always tangent to the worker’s budget line, the model can not explain why some people choose not to work. 5. A firm’s marginal revenue product of labor equals the marginal product of labor times the cost per unit of the labor.
Assume that supply increases greatly and demand increases slightly. Which of the following will happen?
a. Equilibrium price will fall and equilibrium quantity will rise. b. Equilibrium price will rise and equilibrium quantity will fall. c. Equilibrium price will rise and equilibrium quantity will rise. d. Equilibrium price will fall and equilibrium quantity will fall. e. Neither equilibrium price nor equilibrium quantity will change.
If labor is fixed at 5 units, how much does the second unit of capital add to total output? 
Amount of total output produced from various combinations of labor and capital.
A. 490 B. 390 C. 100 D. 50 E. none of the above
Public education is priced below market price largely as a result of
A. taxpayers who contribute little to the funding of public education. B. under-funded public education. C. rising test scores by students. D. government subsidy programs.