A decrease in AS will trigger less inflation under which of the following conditions?
A. AD is relatively steep.
B. AD is relatively flat.
C. AS is relatively steep.
D. AS is relatively flat.
Answer: B
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Which of the following is subtracted from GNP when calculating net national product?
a. Interest b. Capital consumption allowance c. Rent d. Indirect business taxes e. Income tax
Among the impediments to the international mobility of capital are
a. restrictions on foreign ownership. b. fear of nationalization or political instability. c. fluctuations in exchange rates. d. All of the above are correct.
Figure 5-7
In Figure 5-7, budget line B compared to A clearly shows that the
a.
price of wine increased.
b.
price of beer decreased.
c.
price of beer increased.
d.
consumers' money income increased.
Which of the following is least likely to be the case?
A. Medicare changes the mix of output away from medical services. B. Housing subsidies encourage the production of additional housing. C. Food stamps encourage the production of more food. D. Student loans change the mix of output in favor of educational services.