If the slope of a demand curve is infinite, then the price elasticity of demand is:
A. one.
B. zero.
C. infinite.
D. equal to the price of the good.
Answer: B
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Payments by a corporation to its shareholders are known as
A) dividends. B) coupons. C) stocks. D) bonds.
The most accurate measurement of unemployment
a) is an extrapolation based on a random survey of households b) counts the number of workers collecting unemployment insurance benefits c) uses payroll data by subtracting the number of workers employed at firms from the number of citizens of working age d) uses the number of layoffs reported to the government by employers e) none of the above
If people do NOT always make the same mistakes when forecasting the future, then
A. the policy irrelevance theorem holds. B. the Fed can control monetary policy and determine real variables such as real GDP. C. rational expectations are irrational. D. fiscal policy is more effective than monetary policy at fine-tuning the economy.
If the opportunity costs of producing a good increase as more of that good is produced, the economy's production possibility frontier will be
A. a negatively sloped straight line. B. negatively sloped and "bowed inward" toward the origin. C. negatively sloped and "bowed outward" from the origin. D. a positively sloped straight line.