Economists use the phrase "business cycle" when referring to fluctuations in:
A. real GDP.
B. the chain price index.
C. the consumer price index.
D. the general level of prices.
Answer: A
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How do changes in interest rates affect exchange rates?
What will be an ideal response?
Average variable costs:
A. always trend upward as output increases. B. always trend downward as output increases. C. decrease, then increase as output increases. D. increase, then decrease as output increases.
The fact that movie star Angelina Jolie's salary is much higher than the salary earned by the world's best nurse can best be explained by the
a. failure of the market to reward talent fairly. b. large number of nurses. c. willingness of some people to accept a lower wage rate in order to do work they find personally rewarding. d. superstar phenomenon.
When insurance causes people to take more risks, this is called
A. defective telescopic faculty. B. adverse selection. C. asymmetric information. D. moral hazard.