An example of the commodity substitution bias in the calculation of the CPI is a price increase in
A) turkey when the price of chicken doesn't rise.
B) a GPS unit versus a AAA map book.
C) a 2014 Toyota Camry versus a 2005 Honda Civic.
D) etexts versus used books bought through Craigslist.
E) new homes because people's incomes have increased.
A
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Which of the following is an equilibrium condition in the ISLM model?
A) Labor demand = labor supply B) Desired investment = desired saving C) Government spending = taxation D) Money supply = income
When we examine the U.S. money supply, the smallest component of M1 is
A) currency and coins. B) transaction deposits. C) certificates of deposit. D) traveler's checks.
When Classical economists of the 1930s looked at the Great Depression, they:
A. thought it was a result of prices adjusting too quickly. B. suggested wages were too flexible. C. blamed it on activist fiscal and monetary policies. D. lacked a good explanation of why it was happening.
Economic rent directs resources to
A) the people who can use them most efficiently. B) people only. C) large corporations. D) labor-intensive industries only.