Suppose Juliana owns a small business making handbags. Each month she makes 18 handbags, which she sells for $100 each. The materials used to make each handbag cost $50. In addition, Juliana uses a spare room in her house to make the handbags and store her supplies. If she were not using the spare room for her business, she would use it as a guest room, an option that Juliana would value at $250 per month. If Juliana weren't making handbags, she would work at Trader Joe's earning $800 per month. What is Juliana's economic profit each month?
A. $900
B. $650
C. ?$150
D. $750
Answer: C
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If the Fed conducts an open market purchase of bonds, which of the following will happen?
a. The interest rate will decrease, the aggregate expenditure line will shift upward, and the aggregate demand curve will shift leftward. b. The interest rate will increase, the aggregate expenditure line will shift upward, and the aggregate demand curve will shift rightward. c. The interest rate will decrease, the aggregate expenditure line will shift upward, and the aggregate demand curve will shift rightward. d. The interest rate will decrease, the aggregate expenditure line will shift downward, and the aggregate demand curve will shift rightward. e. The interest rate will increase, the aggregate expenditure line will shift downward, and the aggregate demand curve will shift leftward.
A period of decline in total output, income, employment, and trade, lasting six months or longer, is defined as a:
A. trough. B. secular trend. C. business cycle. D. recession.
The ________ the time period, the ________ is the present value of a given future payment, all other things held constant.
a. longer; lower b. shorter; lower c. longer; higher d. shorter; the more uncertain
An economist would say that the benefits of regional integration are determined by
a. the formation of a political union. b. the amount of trade diversion. c. the amount of trade creation. d. the level of consumer involvement. e. the location of manufacturing facilities.