One of the assumptions underlying the production possibilities curve for any given economy is that:
a. the state of technology changes.
b. there is an unlimited supply of resources.
c. there is full employment of resources when the economy is on the curve.
d. goods can be produced outside the curve.
c
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If the Fed decides to buy bonds, the result will be
A) lower bond prices and higher interest rates. B) higher bond prices and higher interest rates. C) higher bond prices and lower interest rates. D) lower bond prices and lower interest rates.
The Smoot-Hawley Tariff
A) raised average tariff rates by over 50 percent in the United States in 1930. B) was passed by the U.S. Congress following the Civil War as a means of increasing government revenue. C) was passed by the U.S. Congress upon a recommendation made by the General Agreement on Tariffs and Trade (GATT) in 1948. D) lowered U.S. tariffs by 50 percent following World War II.
Refer to Figure 11-2. Diminishing returns to labor set in
A) after L1. B) after L2. C) after L3. D) immediately.
Foreign income is defined to be income earned:
A. by a nation’s firms when they operate abroad. B. when a domestic citizen works abroad. C. on investments made abroad. D. by those living outside a country.