When the yield curve slope is more upward sloping than usual, people are expecting:
A. a future rise in short-term interest rates.
B. the Federal Reserve is going to ease monetary policy.
C. an economic slowdown.
D. the U.S. Treasury may default on its obligations.
Answer: A
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The economy pictured in the figure has a(n) ________ gap with a short-run equilibrium combination of inflation and output indicated by point ________. 
A. recessionary; A B. recessionary; C C. recessionary; B D. expansionary; A
Tony's Pizza's production function is shown in the table above. a) Suppose Tony operates Plant 2. He hires 2 workers and produces 20 pizzas a day. Is the pizzeria technologically efficient? Why or why not? b) Suppose Tony operates Plant 1
He hires 2 workers and produces 18 pizzas per day. Is Tony's Pizza technologically efficient? Why or why not? Can Tony increase production to 22 pizzas a day in the short run? If yes, how? c) Suppose Tony operates Plant 3. What is the marginal product of labor when the fourth worker is hired? When operating Plant 3, does Tony experience diminishing marginal returns? Explain. d) Suppose Tony currently uses Plant 3. Can he increase production from 40 to 50 pizzas per day in the short run? In the long run? If yes, how?
Fishermen on the East Coast are using lobster traps out of which most of the lobsters that enter can escape. Why?
A) It will make over-fishing less likely. B) They can't come up with better traps. C) They are not educated enough to maximize profit. D) They catch more lobsters this way.
Which of the following will lead to a decrease in aggregate demand in the United States?
a. a higher price level b. a decrease in the real interest rate c. rapid growth in real income in Japan and Western Europe d. an increase in the exchange rate value of the dollar