Historical data on prices and quantities sold do not provide the basis for drawing an accurate demand curve because
A. reporters who gather these data are often wrong.
B. factors other than price may change over time.
C. they do not include measures of price close to the quantity axis.
D. they sometimes tend to be clustered around one point.
Answer: B
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The opportunity cost of more capital goods today is
A) fewer capital goods in the future. B) fewer consumer goods in the future. C) fewer consumer goods today. D) more unemployed resources in the future.
A shift in the LM curve to the left could be caused by
a. an increase in the price level. b. a decrease in the money supply. c. an increase in the precautionary demand for money. d. all of the above. e. none of the above.
According to efficiency wage models,
a. their key element is an explanation of why the efficiency (or productivity) of workers depends on the real wage. b. the rationale underlying those models implies that firms will set the real wage below the market clearing level. c. they explain real wage volatility. d. all of the above.
An increase in the money supply will cause an increase in which of the following variables?
A) output B) investment C) consumption D) all of the above E) none of the above