The self-correcting tendency of the economy means that rising inflation eventually eliminates:
A. unemployment.
B. exogenous spending.
C. recessionary gaps.
D. expansionary gaps.
Answer: D
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To be officially classified as unemployed, a person must be
A) at least 18 and not working. B) laid off or fired. C) collecting unemployment benefits. D) at least 16, not working and actively seeking employment.
John's utility of wealth curve is shown in the above figure. He currently has total wealth of $20,000. If there is a 50 percent chance that his $10,000 car will be stolen, what is the value of insurance against the theft?
A) $0 B) $5,000 C) $7,000 D) $13,000
Which of the following is an advantage of starting a new business as a corporation?
A) ease in setting up B) low expenses of legally organizing C) double taxation D) greater ability to raise funds
Which of the following is the basic economic policy function of the Federal Reserve Banks?
A. Holding the deposits or reserves of commercial banks. B. Acting as fiscal agents for the federal government. C. Controlling the supply of money. D. The collection or clearing of checks among commercial banks.