The money cost of a particular good will approximate its opportunity cost if
a. there are serious distortions in the market.
b. the market functions well.
c. there is much specialization in the market.
d. nations are exploiting the law of comparative advantage.
b
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Refer to the scenario above. The housekeeper's behavior is an example of a ________
A) moral hazard B) positive externality C) prisoners' dilemma D) tragedy of the commons
Refer to Figure 12.3. Suppose the economy is initially at full employment with real GDP equal to potential GDP, and the Fed does not target interest rates, allowing the real interest rate to change like it did during the Great Depression. This would be reflected as a movement from ________ in the IS-MP model and ________ the Phillips curve.
A) point Y to point X; a movement up B) point X to point Y; a movement down C) point Z to point Y; a movement up D) point Y to point Z; a movement down
Protectionism through _________ implementation makes imports more expensive for consumers and discourages imports.
a. quote b. tariff c. nontariff barrier d. standards
Economic growth can be depicted as
A. a movement along the production possibilities curve. B. a shift of the LRAS curve to the left. C. an inward shift of the production possibilities curve. D. a shift of the LRAS curve to the right.