Which of the following statements is an example of positive economic analysis?
A) The inflation rate is too high.
B) The government should worry less about inflation and more about unemployment.
C) If the government increases the rate of growth of the money supply, the inflation rate will increase, ceteris paribus.
D) The elderly live on a fixed income, so the government has an obligation to keep inflation rates low.
Answer: C
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Moving Water Around The San Diablo dam has electricity generating turbines on a chute that connects lower and upper reservoirs. During the day, water is drained from the upper reservoir to the lower to produce electricity. But at night, electricity is used to pump the water back up to the upper reservoir. Since the water is just going back and forth, how can wealth be generated?
The phase of the business cycle characterized by rising employment is called
a. a recession b. a low-tax phase c. a high-inflation phase d. an expansion e. a depression
The first bankers were
A) sheriffs. B) goldsmiths. C) clergy. D) innkeepers. E) economists.
Who made the campaign pledge, "Read my lips: no new taxes?"
A. Gerald Ford B. Second President Bush C. Ronald Reagan D. First President Bush