Which of the following would cause an economy to be producing at a point inside its production possibilities curve?
A) the efficient allocation of all factors of production
B) population growth
C) unemployment and an inefficient use of available resources
D) capital accumulation
C) unemployment and an inefficient use of available resources
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Starting from long-run equilibrium, a large tax increase will result in a(n) ________ gap in the short-run and ________ inflation and ________ output in the long-run.
A. recessionary; lower; potential B. expansionary; lower; potential C. expansionary; higher; potential D. recessionary; lower; lower
Which of the following would most likely cause a country's production possibilities set to shift outward at every point along the frontier?
A) a decrease in idle capital B) a decrease in unemployment C) a general technological advance that affects all sectors of the economy D) a technological advance in only one sector of the economy E) none of the above
An export subsidy differs from a tariff in each of the following ways EXCEPT
A) a tariff generates revenue. B) a tariff is applied to imports. C) a tariff results in an efficiency loss. D) a tariff is a tax. E) a tariff discourages imports.
Primary credit is only a backup source of funds for health banks since
A) the primary credit rate is set above the federal funds rate. B) restrictions as to its use limit its benefits. C) the secondary credit rate pays 0.5% more. D) banks must seek funds from other sources prior to requesting a discount loan.