Michael can buy either pizzas or submarine sandwiches. If the prices of pizzas and submarine sandwiches double and Michael's money income triples, we can conclude that Michael's budget constraint will
A. shift out but remain parallel to the old one.
B. remain unchanged.
C. shift in but remain parallel to the old one.
D. swivel in so that the slope of the budget constraint is doubled.
Answer: A
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Economic thinking suggests that a nation in which middlemen are considered to be unproductive seekers of profit, and where their activities are heavily restricted by law, will
a. gain by channeling people's efforts away from unproductive middleman activity toward physical output. b. lose the potential gains from trade that would result from lower transaction costs emanating from middleman activities. c. find that it is richer because the added transaction costs normally imposed by middlemen will be reduced. d. gain because the value of total output will rise.
When a country experiences capital flight, the interest rate
a. falls because the demand for loanable funds shifts left. b. falls because the supply for loanable funds shifts right. c. rises because the demand for loanable funds shifts right. d. rises because the supply for loanable funds shifts left.
Which of the following is considered a consumer nondurable?
A. An automobile B. Medical care C. Furniture D. Gasoline and oil
Answer the following statement(s) true (T) or false (F)
1. A job loser is a person who quits his or her job. 2. Frictional unemployment is a persistent problem for the U.S. economy. 3. It is possible for the number of unemployed workers in an economy to equal the number of job vacancies. 4. Certain types of unemployment are unavoidable. 5. The natural rate of unemployment occurs when the economy is functioning at optimum levels.