Inefficient use of resources is shown on the production possibilities curve
A) by an inward shifting of the curve.
B) by a point inside the curve.
C) by a point near the top of the curve.
D) by a point outside the curve.
Answer: B
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If the economy is not fully using its inputs, pumping money into the economy will put ________ pressure on interest rates and will tend to ________ output
A) upward; increase B) upward; decrease C) downward; increase D) downward; decrease
Unless otherwise specified, because it is what people and businesses use in their day-to- day market transactions, when referring to money, economists are talking about
a. M1 b. M2 c. M3 d. credit cards e. liquidity
If the price elasticity of supply is 1.5, and a price increase led to a 1.8% increase in quantity supplied, then the price increase is about
a. 0.67%. b. 0.83%. c. 1.20%. d. 2.70%.
Refer to the graph, in which Dt is the transactions demand for money, Dm is the total demand for money, and Sm is the supply of money. If the interest rate was 4 percent, the asset demand for money would be:
A. $125
B. $175
C. $200
D. $225