Currently, the strategy of the Social Security system is to run surpluses to prepare for the retirement of the baby boom generation. The effectiveness of this strategy is being undermined because
a. rising interest rates make it more expensive for Social Security to borrow.
b. inflation is reducing the value of the Social Security surplus.
c. the trust fund is being used to finance current government expenditures, and the bonds held by the trust fund are an obligation of the U.S. Treasury.
d. the federal budget surplus reduces the Social Security surplus.
C
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If your income stays the same and the price level increases, you will buy fewer goods and services due to the
A) interest rate effect. B) real-balance effect. C) open economy effect. D) aggregate balances effect.
If a hurricane were to wipe out the majority of the eastern seaboard in the United States, it would likely cause a:
A. short-run supply shock. B. long-run supply shock. C. long-run demand shock. D. short-run demand shock.
"Wine experts are discovering that California wines of several varieties and vintages are comparable to many of the best French wines. The result is an increased demand, here and abroad, for California wines." With regard to the U.S. balance on current account, this trend will
a. increase the U.S. deficit because of the rise in the price of California wine. b. decrease the U.S. deficit because of increased shipments of California wines abroad. c. decrease the demand for U.S. dollars. d. increase the U.S. demand for euros.
PriceQuantity SuppliedQuantity Demanded$00300$110250$250180$390150$4120120$515090$618050 Refer to Table 6.1, which gives the daily supply and demand schedules for cups of coffee at a kiosk in a shopping mall. If there is no tax placed on coffee, how many cups of coffee will be bought and sold?
A. 120 B. 150 C. 90 D. 50