Based on the figure below. Starting from long-run equilibrium at point C, a tax increase that decreases aggregate demand from AD1 to AD will lead to a short-run equilibrium at point ________ and eventually to a long-run equilibrium at point ________, if left to self-correcting tendencies.
A. D; C
B. D; B
C. A; B
D. B; C
Answer: B
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If the money supply is $1,000 . the price level is 3, and real income (or output) is $5,000 . then the velocity of money is _____
a. 0.2 b. 0.6 c. 1.67 d. 5 e. 15
Suppose Morris earns $50 per week at his job and chooses to spend all of his income on either apples or biscuits. Suppose apples cost $5 per pound and a pack of biscuits costs $2 each. Which combination of fruits and biscuits will lie on Morris's budget constraint?
a. 6 pounds of apples and 12 packs of biscuits b. 6 pounds of apples and 12 packs of biscuits c. 5 pounds of apples and 8 packs of biscuits d. 8 pounds of apples and 5 packs of biscuits
The following graph is the production possibility curve for a three-person economy, with workers Janna, Drew, and Kari. 
Who has the greatest comparative advantage in shoe production?
A. Kari B. Janna C. Drew D. None of them
If Americans decide to buy more South African diamonds, what is the effect in the foreign market?
A. It will increase demand for U.S. dollars. B. It will decrease demand for U.S. dollars. C. It will increase supply of U.S. dollars. D. It will decrease supply of U.S. dollars.