Figure 33-8
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In Figure 33-8, which of the following movements reflects the closing of a recessionary gap through the economy’s self-correcting mechanism?
A. A to B
B. A to C
C. C to E
D. D to E
Answer: D
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Refer to Table 2.4. What can be observed about the given resources?
A) Land is fixed but fertilizer is variable. B) Land and fertilizer are both fixed. C) Land is variable but fertilizer is fixed. D) Land and fertilizer are both variable.
Under a system of fixed exchange rates, what happens if a country's currency is undervalued?
A) The central bank loses official reserve assets. B) The central bank gains official reserve assets. C) The currency depreciates. D) The exchange rate falls.
Because demand curves slope downward according to the Law of Demand, the price elasticity of demand is a negative number
What will be an ideal response?
If the actual price were below the equilibrium price in the market for bread, a:
A) surplus would develop that cannot be eliminated over time. B) shortage would develop, which market forces would eliminate over time. C) surplus would develop, which market forces would eliminate over time. D) shortage would develop, which market forces would tend to exacerbate.