A university raises annual tuition by 2 percent. No other events have occurred, and the university's revenues have increased. It must be TRUE that
A) the associated change in quantity demanded was smaller than 2 percent.
B) the associated change in quantity demanded was equal to 2 percent.
C) the associated change in quantity demanded was greater than 2 percent.
D) there was no associated change in quantity demanded.
Answer: A
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Recessions typically cause the unemployment rate to ________ and the inflation rate to ________
A) fall; fall B) fall; rise C) rise; fall D) rise; rise
What is the relationship between federal deficits and debt?
a. Deficits are the difference between revenue and spending in one year. b. Deficits are the accumulation of past debt. c. Debt is the difference between revenue and spending in one year. d. Debt is the accumulation of past deficits.
Neoclassical economists who focus on potential GDP as the primary determinant of real GDP argue that the long-run aggregate _______________ curve is located at potential GDP.
a. demand b. supply c. production d. labor
In Figure 1.4, a shift of the production possibilities curve from PP1 to PP2 could be caused by
A. Implementation of training programs that improve the skills of workers. B. A flu epidemic that makes many workers sick. C. Tougher pollution controls for the producers of televisions and smartphones. D. An increase in the unemployment rate.