When a country is considering the question of whether to produce a product domestically or import the product, the country should make the decision based on ___________________.
Fill in the blank(s) with the appropriate word(s).
opportunity cost
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Suppose the economy currently has some underutilized resources. The Fed engages in expansionary monetary policy. The impact of expansionary monetary policy will be to
A) increase aggregate demand, increase prices and increase real GDP. B) increase short-run aggregate supply, decrease in prices and decrease in real GDP. C) increase short-run aggregate supply, decrease prices and increase real GDP. D) increase aggregate demand, increase prices and decrease real GDP.
"The unemployment rate is too high" is an example of a positive economic statement
Indicate whether the statement is true or false
Members of Congress are able to influence monetary policy, albeit indirectly, through their ability to
A) withhold appropriations from the Board of Governors. B) withhold appropriations from the Federal Open Market Committee. C) propose legislation that would force the Fed to submit budget requests to Congress, as must other government agencies. D) instruct the General Accounting Office to audit the foreign exchange market functions of the Federal Reserve.
Refer to Scenario 15.2. If the interest rate were 20%, Furry Software should
A) retool the offices. B) rewire the network. C) move to Southern California. D) be indifferent between retooling and rewiring. E) be indifferent between retooling and moving.