Potential GDP is defined as
A) the amount of GDP produced if there is no structural unemployment.
B) the level of GDP attained when all firms are producing at capacity.
C) the maximum of GDP that the economy can produce.
D) the amount of GDP produced if there is no frictional unemployment.
B
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An alternative to maintaining an overvalued currency is to ________ the fundamental value of the exchange rate by ________ monetary policy.
A. increase; easing B. decrease; tightening C. increase; tightening D. decrease; easing
Economic profits are
A) total revenue minus explicit costs. B) total revenue minus implicit costs. C) total revenue minus explicit and implicit costs. D) total revenue minus accounting costs.
Compared to the present value of a high school education, the present value of at least a college education is
a. 100 times as great b. nearly double c. the same d. about half e. Present value cannot be used to analyze education
What happens when the central bank decides it will sell bonds using open market operations?
a. Interest rates decrease. b. The money supply increases. c. The money supply decreases. d. The money supply is unaffected.