Table 1.3 shows the hypothetical trade-off between different combinations of brushes and combs that might be produced in a year with the limited capacity for Country X, ceteris paribus.Table 1.3Production Possibilities for Brushes and CombsCombinationNumber of combsOpportunity Cost(Foregone brushes)Number of brushesOpportunity Cost (Foregone combs)J4 0NAK3 10 L2 17 M1 21 N0NA23 On the basis of Table 1.3, in the production range of 2 to 3 combs the opportunity cost of producing 1 more comb in terms of brushes is
A. 3.33.
B. 0.67.
C. 0.14.
D. 7.0.
Answer: D
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The delay between when a problem occurs and when it is recognized is referred to as the
A) recognition lag. B) action lag. C) effectiveness lag. D) policy lag.
Economic information
a. is usually scarce and costly to acquire b. is usually available free to any decision maker c. is usually not required for rational decision making d. must be complete before any decision is made e. is usually useful only to governments
Which of the following is an example of an intermediate good?
a. Sugar bought by a bakery b. Sugar bought by a family c. Furniture bought by a family d. Burgers bought at a restaurant e. Medicines bought at a pharmacy
Which of the following is true? a. The money supply will tend to fall when the Fed pays a higher interest rate on bank reserves
b. If banks never wanted to hold excess reserves, decreasing the interest rate the Fed pays on reserves would not increase the money supply. c. If banks hold excess reserves, the actual money multiplier would be less than potential money expansion. d. All of the above are true