In the spring of 2002 we were in the _____ phase of the business cycle.
A. recovery
B. prosperity
C. depression
D. recession
A. recovery
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Which of the following most accurately indicates the implications of an economy's production possibilities curve?
a. If all the resources of an economy are being used efficiently, more of one good can be produced only if less of another good is produced. b. If all the resources of an economy are being used efficiently, it is generally possible to produce more of one good without having to sacrifice the production of other goods. c. Over time, it is generally impossible for a country to expand its production of goods. d. An economy will automatically move toward a point that lies outside of the production possibilities constraint unless proper government policy constrains production.
The French term "laissez-faire" means:
A. "there is no free lunch." B. "let it be." C. "circular flow." D. "public ownership."
Based on our understanding of the IS-LM model that takes into account dynamics, we know that an increase in the money supply will cause
A) an immediate increase in i and no initial change in Y. B) an immediate decrease in i and no initial change in Y. C) a gradual decrease in i and gradual increase in Y. D) none of the above
What does the law of supply state?
a. Price and quantity demanded are inversely related. b. An increase in demand will cause a leftward shift in the supply curve. c. Price and quantity supplied are positively related. d. A shift in the supply curve must be the result of a change in prices.