The set of goods and services that maximizes the level of satisfaction for each consumer subject to limited income is
A) the consumer optimum.
B) diminishing marginal utility.
C) increasing marginal utility.
D) substitution effect.
Answer: A
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Persons who do not work because of bad weather or vacation are part of
a. the unemployed labor force. b. the employed labor force. c. frictional unemployment. d. cyclical unemployment.
If the real interest rate is 7.5% and the rate of inflation is 3%, what is the nominal interest rate?
A. 4.50% B. 4.57% C. 10.50% D. 10.73%
There are ________ Federal Reserve Banks located in different parts of the United States.
A. 10 B. 12 C. 15 D. 50
If you feel you are better off because you receive a 5 percent raise even when the price level also increases by 5 percent, then you are a victim of the
A. money illusion. B. money income effect. C. purchasing power effect. D. real income effect.