Hurricane Katrina destroyed much of New Orleans and other parts of the South. Which of the following statements is true? The hurricane:
A. caused the production possibilities frontier of the United States to shift.
B. caused the production possibilities to increase, since it created a lot of work to rebuild the city affected areas.
C. caused the production possibilities frontier of the United States to shift in.
D. didn't change the production possibilities frontier, but moved from a point on the frontier to a point inside the frontier.
Answer: C
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The average household in Australia spends AUD 560 on groceries per month. What would this grocery bill amount to in U.S. dollars if the current exchange rate is AUD 1.55 per dollar?
a. $868.00 b. $560.00 c. $447.91 d. $361.29 e. $222.00
A key issue in the present disagreement between Keynesian and monetarist economists is whether
A. monetary policy can bring the economy to full employment. B. the economy is better off with policy makers adopting a strict rule or using their discretion to set policies. C. monetary policy can influence interest rates. D. fiscal policy involves the use of taxation.
When the fed wants to end a recession, they will act to ___ interest rates and ____ the money supply
a. increase; increase b. increase; decrease c. decrease; decrease d. decrease; increase
An increase in total revenue will result if
A) demand is inelastic and price increases. B) demand is elastic and price increases. C) demand is inelastic and price decreases. D) demand is unitary elastic and price decreases.