Which of the following will result in an outward shift of the production possibilities curve [PPC]?
a. A decrease in the quantity of resources
b. An improvement in the quality of resources
c. A fall in education standards
d. An unsustainable growth in population
e. An increase in unemployment rate
b
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An increase in the money supply will raise equilibrium GDP if the
A) IS curve is not vertical. B) IS curve is negatively sloped. C) position of the IS curve depends on the level of real money balances. D) position of the LM curve depends on the level of real money balances.
What percentage of the world's population subsists on incomes of less than $3 a day?
A. 40 percent. B. 60 percent. C. 70 percent. D. 50 percent.
Suppose the value of income elasticity of demand for a private college education is equal to 1.5. This means that:
A. every $1 increase in income provides an incentive for a $1.50 increase in expenditures on private college education. B. a 10 percent decrease in private college tuition will have a large enough income effect to increase spending on private college education by 15 percent. C. a 10 percent increase in income causes a 15 percent increase in the quantity of private college education purchased. D. a 15 percent increase in income causes a 10 percent increase in the quantity of private college education purchased.
Refer to the diagram for the federal funds market. If the quantity of reserves falls from $150 billion to $125 billion, we can expect:
A. the federal funds rate to rise to 4.0 percent.
B. the discount rate to rise to 3.5 percent.
C. the prime interest rate to rise.
D. banks to loan more to each other.