Ethics is about making good decisions. Sometimes it is hard to see what economics has to do with ethics until you remember that economics is often defined as the:
A. science of choice.
B. study of production techniques.
C. key branch of theology.
D. study of market failures.
Answer: A
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A small country is an international borrower and its domestic supply of loanable funds increases. Consequently, the equilibrium quantity of loanable funds used in the country ________ and the country's international borrowing ________
A) does not change; decreases B) does not change; does not change C) does not change; increases D) increases; does not change
Suppose the economy is in a long-run equilibrium when a temporary, favorable aggregate supply shock occurs. On the graphs above, show what happens to bring the economy back to long-run equilibrium, assuming that there is no policy response
In words, explain why "no response" is the best policy.
Tax-exempt bonds:
A. generate higher returns for the bondholder when purchased through a tax-exempt retirement account. B. are most beneficial to those who pay higher income tax rates. C. are not affected by changes in yields on taxable bonds. D. include U.S. Treasury securities because the Internal Revenue Service does not charge income tax on interest earned from these bonds.
The cost of using an additional unit of an input is called the
A. marginal physical product cost. B. marginal product of labor. C. marginal factor cost. D. marginal revenue product.