Consider an economy where the growth rate of real GDP is 6% and the annual rate of inflation is 2%. If the quantity theory of money holds, the growth rate of money supply in the economy will be:
A) 6%. B) 2%. C) 8%. D) 4%.
C
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Moe has a big exam tomorrow. He considered studying this evening, but decided to hang out with Curly instead. If neither activity involves any explicit costs, and Moe always chooses rationally, then it must be true that:
A. Moe gets less benefit from spending time with Curly than from studying. B. the opportunity cost of studying is greater than the value Moe gets from spending time with Curly. C. Moe gets more benefit from spending time with Curly than from studying. D. the opportunity cost of studying is less than the value Moe gets from spending time with Curly.
If a Cobb-Douglas production function has alpha = 0.34 and beta = 0.42, then a 1% increase in inputs results in a ________ change in output
A) 0.8% B) 8% C) 0.76% D) -0.76%
If a market is contestable, then
a. long-run economic profits are minimal due to inefficiency. b. long-run economic profits are zero. c. short-run and long-run economic profits are zero. d. positive economic profits are maximized due to the efficient production spurred by the threat of entry.
Excluding household and underground production leads to
A) underestimation of real GDP but not nominal GDP. B) overestimation of real GDP but not nominal GDP. C) overestimation of both real GDP and nominal GDP. D) underestimation of both real GDP and nominal GDP. E) underestimation of real GDP an overestimation of nominal GDP.