A study of the U.S. price level and real GDP from 1972 to 2007 reveals a clear upward march toward higher prices and greater output. What explains this?
a. Both the aggregate demand curve and the aggregate supply curve have shifted to the left year after year.
b. Both the aggregate demand curve and the aggregate supply curve have shifted to the right year after year.
c. The aggregate supply curve has shifted to the right while the aggregate demand curve has shifted to the left.
d. The aggregate supply curve has shifted to the left while the aggregate demand curve has shifted to the right.
b
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Holding all else equal, if the U.S. government imposes tariffs on imported products, then the equilibrium value of the U.S. dollar will:
A. be determined by the Federal Reserve. B. depreciate. C. remain fixed. D. appreciate
Refer to the table below. Suppose the profit for each unit of paper product is $3.00 and the profit for each unit of lumber is $13.50 and Big Oaks is producing the profit-maximizing quantity of lumber and paper products. If the profit from each unit of lumber increases from $13.50 to $15.00 and the profit for each unit of paper products does not change, to maximize profit, Big Oaks should produce
a ________ proportion of lumber and produce ________ units of paper products and lumber.
Big Oaks can produce either paper products or lumber with each tree that they harvest. Because Big Oaks can adjust the amount of paper products and lumber they produce from the harvested trees, paper products and lumber are produced in variable proportions. The above table summarizes Big Oaks production possibilities from each harvested tree.
A) smaller; less
B) smaller; more
C) greater; more
D) greater; less
An entrepreneur is best described as
a. someone that is hired to work in a firm b. someone who creates human capital c. someone with the ability to combine other resources in a productive enterprise d. anyone who owns productive enterprise e. anyone who produces long-lived physical capital
The classical model does a good job of explaining the __________ while doing poor a job of explaining the __________
a. short run; long run b. business cycle; long run c. short run; business cycle d. unemployment rate; interest rates e. long run; short run