If assets are imperfect substitutes, then an increase in the amount of domestic currency bonds held by the public will ________ the risk premium and ________ the amount of domestic currency bonds held by the central bank
A) increase; leave unchanged
B) increase; decrease
C) increase; increase
D) decrease; decrease
E) leave unchanged; decrease
A
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Consider a perfectly competitive market experiencing good times. In the short run, the equilibrium price will ________ and firms will earn a(n) ________
A) increase; economic profit as the new price exceeds average total cost B) increase; normal profit as the new price exceeds average total cost C) decrease; economic loss as new firms enter the industry D) decrease; economic profit as firms exit the industry E) may increase or decrease; normal profit depending on their costs
Refer to the above diagram, which shows three demand curves for coffee. Which would cause the change in the quantity of coffee demanded illustrated by the shift from point a to point b?
A. A decrease in the price of coffee B. A decrease in the price of sugar C. An increase in consumer incomes D. An increase in the price of tea
The supply curve for motor oil is the typical upward-sloping straight line, and the demand curve for motor oil is the typical downward-sloping straight line. When motor oil is taxed, the area on the relevant supply-and-demand graph that represents the deadweight loss is
a. larger than the area that represents consumer surplus in the absence of the tax. b. larger than the area that represents government's tax revenue. c. a triangle. d. All of the above are correct.
Increasing productivity per person:
A. is highly undesirable, as it leads to increases in GDP per capita. B. is highly desirable, as it leads to economic growth. C. is unavoidable, and macroeconomists work to prevent it. D. can harm an economy if misallocated.