The real value of an economic variable is
A. the producer price.
B. computed by taking the nominal value and dividing by the appropriate price index.
C. the consumer price index.
D. expressed in terms of actual market prices at which goods are sold.
Answer: B
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Assuming that the exchange rate rises by 5 percent, hence, the dollar volume of exports rises by 5 percent, then foreign exchange earnings would
a. remain constant. b. increase by 5 percent. c. actually decrease by 5 percent. d. increase by 10 percent.
Under which of the following conditions will a change in government purchases have the greatest effect on the economy in the short run?
a. The aggregate demand curve is relatively flat. b. The aggregate demand curve is relatively steep. c. The short-run aggregate supply curve is relatively flat. d. The aggregate demand curve is vertical. e. The short-run aggregate supply curve is vertical.
A firm's short-run supply curve is its marginal cost curve.
a. true b. false
Laws that make it difficult to start a new business lead to a
A. laissez-faire. B. more political freedom. C. high rate of economic growth. D. low rate of economic growth.