Which of the following is part of the economic way of thinking?
a. Opportunity costs will always be incurred when scarce resources are used to produce a good.
b. When the cost of an option increases, individuals will be less likely to choose it.
c. In addition to their immediate direct effects, economic actions often generate secondary effects that are observable only after the passage of time.
d. All of the above are part of the economic way of thinking.
D
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The combination of rising inflation and higher unemployment is called:
A) recession. B) expansion. C) stagflation. D) deflation.
Monetarists assume that there is a powerful direct link between aggregate demand and
A) velocity. B) real money balances. C) wage rates. D) interest rates.
Suppose beer producers in Munich became aware of the low price of one barrel of beer in the domestic market relative to that in the United States. What will be the impact of this price difference?
a. Beer production in Munich will decline. b. Price of beer in the domestic market will increase. c. Beer production in the U.S. will increase. d. Beer consumption in the domestic market will increase.
A price index number
a. is really a percentage. b. indicates the extent of change in prices over some period of time. c. is always greater than 100 if prices have risen during the period in question. d. All of these.