An example of an intermediate good or service would be:
A. sacks of groceries bought by a dentist for his family.
B. a car bought by a stockbroker for commuting to work.
C. a desk bought by an accountant for her office.
D. bricks bought by a homeowner for constructing a patio.
Answer: C
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The self-correcting tendency of the economy means that rising inflation eventually eliminates:
A. unemployment. B. exogenous spending. C. recessionary gaps. D. expansionary gaps.
The opportunity cost of good A in terms of good B is equal to the
A) money price of good A minus the money price of good B. B) money price of good B minus the money price of good A. C) ratio of the money price of good A to the money price of good B. D) ratio of the money price of good B to the money price of good A.
Kirk consumes normal goods. If Kirk's income decreases and the prices of all goods remain unchanged, in his new consumer equilibrium, his marginal utility from each good will ________ and his total utility will ________
A) increase; increase B) increase; decrease C) decrease; increase D) decrease; decrease
What is the most direct method the Fed uses to change the monetary base?
A) open market operations B) changing the required reserve ratio C) changing the federal funds rate D) changing the level of discount loans