A point on a nation's production possibilities curve represents
A. The full employment of resources to achieve a particular combination of goods and services.
B. Combinations of production that are unattainable, given current technology and resources.
C. An undesirable combination of goods and services.
D. Levels of production that will cause both unemployment and inflation.
Answer: A
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An open economy
A) can save only by building up its capital stock. B) can save only by acquiring foreign wealth. C) cannot save either by building up its capital stock or by acquiring foreign wealth. D) can save either by building up its capital stock or by acquiring foreign wealth. E) can save by avoiding excessive imports.
By including another variable in the regression, you will
A) decrease the regression R2 if that variable is important. B) eliminate the possibility of omitted variable bias from excluding that variable. C) look at the t-statistic of the coefficient of that variable and include the variable only if the coefficient is statistically significant at the 1% level. D) decrease the variance of the estimator of the coefficients of interest.
The distinction between positive and normative economics
a. is that positive economics applies only to microeconomic problems b. is that normative economics applies only to microeconomic problems c. is the difference between an assumption and a conclusion d. helps us understand why economists sometimes disagree with one another e. explains why economics is not a social science
Economists would describe cartels as
a. the opposite of ignoring interdependence. b. a collusive arrangement. c. an undesirable form of market organization that may charge a monopoly price. d. All of the above are correct.