Long-run economic growth can occur as the result of
A. A technological advance.
B. A rightward shift in aggregate demand.
C. The employment of more of the available resources.
D. An increase in the price level.
Answer: A
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All else being equal, if European firms switch from U.S. produced software to software produced in India, the equilibrium value of the U.S. dollar will:
A. fall. B. either rise or fall depending on whether the supply or demand for dollars changes more. C. rise. D. become fixed.
If the secular trend of labor productivity is 3 percent per year, the number of years that it will take for the standard of living to double will be about:
A. 23 years. B. 20 years. C. 15 years. D. 17 years.
Suppose that an economics professor selects two students, Audrey and Michael, to participate in a classroom experiment. The professor gives Audrey twenty $1 bills. Audrey must pick an allocation of the twenty $1 bills to offer to Michael. If Michael accepts the allocation, each student keeps his or her portion of the money. If Michael rejects the allocation, the professor keeps the $20, and each
student receives nothing. Audrey selects $19 for herself and $1 for Michael. Based on the studies of human decision making, which of the following statements is correct? a. If Michael accepts the offer, he is behaving rationally. b. If Michael rejects the offer, he may value fairness more than $1. c. If Michael rejects the offer, Audrey made a bad choice by trying to keep $19 for herself. d. Any of the above could be correct.
If demand increases, the increase in price will be smaller if demand and supply are highly inelastic.
Answer the following statement true (T) or false (F)