Which of the following is an example of the recognition lag?
A. The recession began in July, but the data did not confirm that fact for seven more months.
B. Fearing inflation, the Fed reduced the money supply in March, but the aggregate demand did not begin to shift to the left until November.
C. The aggregate demand initially shifted to the right in January, but did not fully shift until October.
D. Once the recession was recognized, it took three months to formulate a new policy to combat it.
Answer: A
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The above table shows production points on Sweet-Tooth Land's production possibilities frontier. Which of the following is an example of a point that is inefficient?
A) 0 chocolate bars and 100 cans of cola B) 20 chocolate bars and 80 cans of cola C) 32 chocolate bars and 40 cans of cola D) 38 chocolate bars and 0 cans of cola
Suppose a union successfully negotiates for its members a wage rate that is above the competitive wage rate, then
A) there will be a surplus of jobs. B) antitrust laws become effective. C) there will be downward pressure on the wage rate until equilibrium is established. D) there will be an excess supply of labor.
When the price of movie tickets in a certain town was reduced, the movie-theaters' revenues did not change. This suggests that the demand for movie tickets in that town has a price-elasticity coefficient of:
A. 1.0 B. Greater than 1 C. 0.5 D. Zero
Because warranties are potentially ________, low-quality goods are ________ to have warranties
A) very expensive; less likely B) inexpensive; less likely C) very expensive; more likely D) inexpensive; more likely