Suppose an American worker can make 20 pairs of shoes or grow 100 apples per day. On the other hand, a Canadian worker can produce 10 pairs of shoes or grow 20 apples per day. The opportunity cost for Canada is:
A. 2 apples for each pair of shoes.
B. 2 pairs of shoes for each apple.
C. ½ apple for each pair of shoes.
D. ½ pair of shoes for every 2 apples.
A. 2 apples for each pair of shoes.
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In the 1950s the interest rate on three-month Treasury bills fluctuated between 1 percent and 3.5 percent; in the 1980s it fluctuated between ________ percent and ________ percent
A) 5; 15 B) 4; 11.5 C) 4; 18 D) 5; 10
The "dual mandate" refers to the:
A. twin responsibilities of the Federal Reserve, to use monetary policy to ensure price stability and maintain full employment. B. orders given to both the Federal Reserve and the Treasury department to ensure price stability. C. responsibility given to the Federal Reserve and the Congress to conduct monetary and fiscal policy respectively, to ensure price stability. D. role that the Fed has by being a governmental agency but also must act in the best interest of all citizens of the United States.
The amount of government debt is called the public cost.
Answer the following statement true (T) or false (F)
Suppose real GDP is $800 billion when the MPC is 0.80, and people decide to increase their saving by $30 billion. Before this change, the economy was in equilibrium with people intending to save $100 billion and producers intending to invest $100 billion. The new equilibrium level of real GDP is:
A. $600 billion. B. $650 billion. C. $680 billion. D. $730 billion.