Economic models
a. cannot be useful if they are based on false assumptions.
b. were once thought to be useful, but that is no longer true.
c. must incorporate all aspects of the economy if they are to be useful.
d. can be useful, even if they are not particularly realistic.
d
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If the nominal wage is $30 in 2011 and the CPI is 202 in 2011, then the real wage in 1982-1984 dollars
A) is $14.85. B) is $30. C) is $1.48. D) is $29.00. E) cannot be calculated without the past year wage rate.
When goods and services are produced at the lowest possible cost, ________ occurs
A) efficient central planning B) equity C) productive efficiency D) allocative efficiency
Countries tend to be classified as more or less developed based on
a. the literacy rate. b. the poverty rate. c. the level of income per capita. d. the types of goods they produce.
The "crowding-out" debate refers to the disagreement between Keynesians and conservative economists about whether
A. spending for national defense causes reductions in the spending for social welfare. B. government contracts with suppliers of military weapons results in unfair competition with non-defense related industries. C. increased government borrowing has an adverse effect on private investment spending. D. restrictive monetary policy makes expansionary fiscal policy ineffective.