Which of the following is the best explanation for why President Harry Truman once said that he wanted to find a one-armed economist?
a. President Truman received input from so many economists that he only wanted one view from each.
b. President Truman thought economists should analyze policies but not make or enforce them.
c. Economists understand that most policy decisions involve trade-offs so they are likely to present multiple views of policies.
d. A one-armed economist would conduct only positive analysis and no normative analysis.
c
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The total value of the goods and services produced over a period of time represents an economy’s
a. planned savings. b. total income. c. total wealth. d. capital.
Suppose that a mining company employs 80% of the available laborers in a town. Explain what will happen to the number of laborers hired and the wage rate paid by the mine if a minimum wage is set at the competitive level
What will be an ideal response?
Saving is
a. helpful for production but not necessary b. not useful for production because they imply a decrease in consumption c. required for production d. not useful for production because it is not a resource e. not useful for production because savers must be paid interest
If the Fed reduces the discount rate, which of the following are most likely to result?
a. The money supply curve shifts rightward, and the equilibrium interest rate falls in the money market. b. Investment declines, causing the aggregate demand curve to shift leftward, reducing equilibrium real GDP and thus slowing the economy. c. Investment rises, causing the aggregate demand curve to shift rightward, increasing equilibrium real GDP and thus accelerating the economy. d. Both a. and b. above are correct. e. Both a. and c. above are correct.