Use the following graphs to answer the next question.
In the diagrams above, AD1 and AS1 represent the initial state of an economy. If full-employment output is at Q2, which diagram represents the adjustment back to full employment output in the absence of government intervention? ________.
A. panel (A) only
B. panel (B) only
C. panel (C) only
D. panels (B) and (C)
Answer: B
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The supply curve of books (which are produced using paper made from trees) will shift to the left in response to
A. a decline in college tuition. B. an increase in home building. C. an increase in the supply of lumberjacks. D. an end to government regulations that limit timber harvesting in national forests.
A graph that shows the value of an economic variable for different groups in a population at a given time is called a
A) pie chart. B) cross-section graph. C) scatter diagram. D) time-series graph. E) fixed-time diagram.
A supply curve shows the relationship between:
A) output and the total cost of production. B) output and prices. C) output and consumer income. D) output and revenue.
What is the most direct method the Fed uses to change the monetary base?
A) open market operations B) changing the required reserve ratio C) changing the federal funds rate D) changing the level of discount loans