Which of the following is true when an economy is producing efficiently?
A. The economy is producing on the production possibilities curve.
B. The economy is getting the fewest goods and services from the available resources.
C. Everyone in the economy is happy.
D. The economy is producing outside the production possibilities curve.
Answer: A
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Working fewer hours to reduce your tax burden is tax evasion.
A. True B. False C. Uncertain
If the central bank targets the interest rate, it
a. must decrease interest rates in response to an increase in money demand. b. rules out the possibility of runaway inflation. b. can lead to runaway inflation if maintained too rigidly. d. Both a and c e. Both b and c
Using a Paasche index to calculate the Consumer Price Index (CPI)
A) weights quantities with current prices. B) weights prices with base-year quantities. C) weights quantities with base-year prices. D) weights prices with current year quantities.
The Lorenz curve showing perfect income equality would be
A. I.
B. J.
C. K.
D. L.