Because of increasing opportunity costs, the production possibility curve:
A. Is bowed out from (or concave to) the origin
B. Can be either downward- or upward-sloping
C. At first rises, then falls eventually
D. Is a straight downward-sloping line
Answer: A
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Business's cost of changing prices is referred to as:
A) inflation tax. B) menu costs. C) intangible costs. D) shoeleather costs.
Describe the process of "creative destruction" using a specific example
What will be an ideal response?
In the ISLM framework, monetary policy has the greatest impact on equilibrium income
A) when money demand = money supply. B) when money supply is infinitely elastic. C) when the interest rate is high. D) the less is the interest-sensitivity of money demand.
Which of the following could explain a decrease in the equilibrium interest rate and in the equilibrium quantity of loanable funds?
a. The demand for loanable funds shifted rightward. b. The demand for loanable funds shifted leftward. c. The supply of loanable funds shifted rightward. d. The supply of loanable funds shifted leftward.