A society can consume a combination of goods outside its production possibilities if there is:
A. Lower unemployment
B. International specialization and trade
C. A change in consumers' tastes
D. A change in prices
Answer: B
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Using Figure 1 above, if the aggregate demand curve shifts from AD3 to AD2 the result in the short run would be:
A. P3 and Y1. B. P2 and Y1. C. P2 and Y3. D. P1 and Y2.
In the open-economy macroeconomic model, if the supply of loanable funds increases, net capital outflow
a. and the real exchange rate increase.
b. and the real exchange rate decrease.
c. increases and the real exchange rate decreases.
d. decreases and the real exchange rate increases.
Alyssa runs a "Dessert of the month" delivery service. To operate her business each year, she spends $30,000 on baking supplies (flour, sugar, etc.), $50,000 on rent for her shop, and $5,000 for utilities. She owns her delivery van, estimating that in alternate uses it could generate $15,000 in income per year. Alyssa has other funds tied up in the business that could earn her $2,000 per year in interest. Alyssa has been offered $50,000 to work full time at a competing bakery. Her bakery generates $160,000 per year in revenue from subscriptions to her monthly service.Based on the information above, which of the following is true about Alyssa's costs and profits?
A. Alyssa's implicit costs are $67,000 and her economic profits are $93,000. B. Alyssa's explicit costs are $85,000 and her accounting profits are $8,000. C. Alyssa's explicit costs are $67,000 and her implicit costs are $85,000. D. Alyssa's accounting profits are $75,000 and her economic profits are $8,000.
In recent decades, the union-nonunion hourly wage differential has
A) increased substantially. B) increased slightly. C) stayed the same. D) fallen significantly.