The downward slope of the production possibilities curve illustrates the:
A. Scarcity Principle.
B. Principle of Comparative Advantage.
C. Incentive Principle.
D. Cost-Benefit Principle.
Answer: A
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If aggregate demand just decreased, which of the following may have caused the decrease?
A) a decrease in the price level B) a decrease in imports C) a decrease in the interest rate D) a decrease in exports
The expression "increase in quantity supplied" is illustrated graphically as a
A) leftward shift in the supply curve. B) rightward shift in the supply curve. C) movement up along the supply curve. D) movement down along the supply curve.
If the federal government borrows from the private sector to pay for increased budget deficits and interest rates increase, this will cause
A) a decrease in planned investment and planned consumption. B) an increase in planned investment and planned consumption. C) a decrease in planned investment and an increase in planned consumption. D) an increase in planned investment and a decrease in planned consumption.
When a household lends money directly to a firm, the firm gives the household a
A. dividend. B. bond. C. certificate of investment. D. share of stock.