In economics, the term capital refers to
a. money.
b. stocks and bonds.
c. equipment and structures used in production.
d. All of the above are correct.
c
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The amount by which people will increase or decrease their purchases when prices change
A) is typically greater in the case of luxuries than in the case of necessities. B) is typically less for business firms than for households because business firms can more easily borrow to maintain purchasing patterns. C) is typically less for business firms than for households because business firms must have certain goods to remain in operation. D) tends to be greater over longer periods of time because it takes time to invent and to discover substitutes. E) will be approximately zero unless the demand also changes.
A friend claims that the United States is a net international debtor. The best way of testing this claim is to see whether
A) U.S. foreign liabilities exceeded U.S. foreign income. B) U.S. receipts from foreign assets exceeded U.S. payments to foreign owners of U.S. assets. C) U.S. official reserve assets were positive or negative. D) the United States ran a balance of payments surplus or deficit last year.
In the 1960s, the U.S. experienced ongoing inflation. What was the main cause of this inflation?
a. The economy's self-correcting mechanism was allowed to operate. b. The Federal Reserve maintained an output target. c. The Federal Reserve increased the money supply in response to positive demand shocks. d. The Federal Reserve pursued an active monetary policy. e. The Federal Reserve increased the money supply in response to negative demand shocks.
The short-run average cost curve shows the lowest possible average cost corresponding to each output level, assuming that all inputs are variable
a. True b. False Indicate whether the statement is true or false