If resources are combined efficiently in production, then the society
A. is producing at a point on the production possibility frontier but not necessarily at the most-desirable point.
B. is experiencing economic growth.
C. is producing at a point outside the production possibility frontier.
D. is producing at the most-desirable point on the production possibility frontier.
Answer: A
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Which of the following best defines capital as a factor of production?
A) the gifts of nature that businesses use to produce goods and services B) the knowledge and skills that people obtain from education and use in production of goods and services C) financial assets used by businesses D) instruments, machines, and buildings used in production
If nominal GDP is $10 trillion and real GDP is $12 trillion, then the GDP deflator is
a. 83.33, and this indicates that the price level has decreased by 16.67 percent since the base year. b. 83.33, and this indicates that the price level has increased by 83.33 percent since the base year. c. 120, and this indicates that the price level has increased by 20 percent since the base year. d. 120, and this indicates that the price level has increased by 120 percent since the base year.
When an economy is not producing at its potential output, which of the following is likely?
What will be an ideal response?
Under the Bretton Woods system, countries experiencing current account surpluses
A. were obliged to revalue their currencies. B. could maintain their fixed exchange rate by selling excess foreign exchange. C. were obliged to stimulate their economies. D. could maintain their fixed exchange rate by buying excess foreign exchange.