When the housing bubble popped, the effect of the negative demand side shock and the negative supply side shock were the same on:
A. output, causing it to definitely decrease.
B. prices, causing them to definitely rise.
C. output, causing it to definitely increase.
D. prices, causing them to definitely fall.
Answer: A
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The economist that devised a method for setting the level of a public good efficiently is:
A. John Nash. B. Arthur Cecil Pigou. C. Ronald Coase. D. Theodore Groves.
The primary criticism by Keynesians of the credibility argument for rules is that
A) reputations are a less costly method of gaining credibility. B) reputations are a less costly method of maintaining credibility. C) the cost of losing flexibility over policy choices may exceed the cost of gaining credibility. D) rules that reduce presidential and congressional influence over monetary policy could ultimately be harmful to the economy.
The _____ allows voters to vote on a series of marginally smaller quantities of a good
a. committee version of the medium voter model b. representative democracy version of the medium voter model c. referendum version of the medium voter model d. cyclical majority
In Figure 1.2, which labeled points are unattainable? 
A. only A B. only B and C C. only D D. A, B, and C