If the quantity of real GDP demanded is greater than the quantity of real GDP supplied, then
A) the economy must be producing at potential GDP.
B) aggregate demand changes to restore equilibrium.
C) the price level falls to restore the macroeconomic equilibrium.
D) the price level rises and firms increase production.
E) the price level falls and firms decrease production.
D
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If the government drafts people into the armed forces rather than persuading them to volunteer
A) it conceals in part the cost to its citizens of obtaining military personnel. B) it employs a nondiscriminatory system because everyone drafted incurs the same cost and can be paid the same wage. C) it must pay higher wages since many people resent the draft. D) it reduces the cost to the nation as a whole of obtaining military personnel. E) it tends to obtain people with the lowest opportunity costs.
Economics promotes which of the following as the way to make the best decision?
A) Continue an enjoyable activity up to the point where its marginal benefit equals its marginal cost. B) Continue an enjoyable activity until it is no longer enjoyable. C) Continue an enjoyable activity until you cannot afford to pursue it. D) Continue an enjoyable activity as long as you do not have to pay for it.
Under the Articles of Confederation,
a. only the federal government could issue paper money. b. only the federal government had the power to levy taxes. c. the federal government was ultimately responsible any debts incurred by the states. d. the federal government had a difficult time negotiating military and economic treaties with other nations. e. All of the above.
In recent years, the ratio of earnings of the typical U.S. college graduate to the earnings of the typical high school graduate without additional education has
a. risen as the demand for skilled labor has increased relative to the demand for unskilled labor. b. risen as the demand for skilled labor has decreased relative to the demand for unskilled labor. c. fallen as the demand for skilled labor has increased relative to the demand for unskilled labor. d. fallen as the demand for skilled labor has decreased relative to the demand for unskilled labor.