The balance of payments constraint refers to the limits on:
A. exchange rate policy imposed by flexible exchange rates.
B. currency convertibility observed in most developing countries.
C. domestic macroeconomic policy, arising from a shortage of international reserves.
D. macroeconomic policy resulting from IMF conditionality.
Answer: C
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Which of the following would not be included in the calculation of accounting profit?
A. The rent paid by the owner for the use of a building. B. The salary the owner could have earned working elsewhere. C. The medical insurance coverage for the company's workers. D. The wages paid to the company's workers.
The observation that the demand curve for grape jelly shifts rightward every time the price of peanut butter falls means that grape jelly and peanut butter are
A) complements. B) substitutes. C) inferior goods. D) normal goods.
Use the following consumption schedule to answer the next question.
At income level 1, the amount of saving is
A. negative. B. positive. C. zero. D. not measurable.
Which of the following is the LEAST scarce?
A. medicine B. college education C. air D. gold deposits