Suppose a Big Mac costs $4.20 in the United States and 9.55 zlotys in Poland. If the exchange rate is 2.77 zlotys per dollar, purchasing power parity predicts that
A) the dollar is undervalued.
B) the zloty is undervalued.
C) the zloty is overvalued.
D) both the dollar and the zloty are undervalued.
B
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You are at a restaurant deciding if you would like some dessert after the meal. The dinner is over so you do not want anything else but the dessert. The opportunity cost of getting the dessert would include
a. Nothing, because you are already there b. Another round of appetizers possibly c. Anything else you could buy d. None of the above
A firm that minimizes average cost will not survive in the long run
a. True b. False
Under representative democracy,
a. the median voter's preferences are always satisfied b. citizens no longer have any influence since they do not vote on each issue c. representatives may reflect the preferences of the median voter d. less vote trading will occur than under direct voting e. vote trading is impossible
Which of the following is associated with an increase in the average price level?
a. A decrease in the aggregate quantity demanded b. An increase in the aggregate quantity demanded c. A leftward shift of the aggregate demand curve d. A decrease in the aggregate quantity supplied e. Aggregate quantity demanded remains unchanged but the aggregate expenditures curve shifts leftward.