A president of the United States promises to produce more defense goods without any decreases in the production of other goods. This promise can be valid
A) if the United States is producing at a point on its production possibilities frontier.
B) if the United States is producing at a point inside its production possibilities frontier.
C) if the United States is producing at a point beyond its production possibilities frontier.
D) only if the production possibilities frontier shifts rightward.
B
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One explanation for the fall in the value of the U.S. dollar since 2001is
a. the mix of an tight fiscal/tight monetary policy over the period. b. the relative weakness of the U.S. economy over the period. c. a higher degree of accommodation of supply shocks in the United States relative to our trading partners. d. the disintegration of the Bretton Woods system during these years.
If in market equilibrium the marginal social cost of producing a good exceeds the marginal private cost,
a. not enough of the product is being produced b. the price charged for the good is too high c. the good produces a positive externality d. the good produces a negative externality e. the government should produce the good
A country that is half as productive at producing some goods as another country, but is one quarter as productive at producing others, will not be able to gain from trade
a. True b. False Indicate whether the statement is true or false
Suppose a bank has $200,000 in deposits, a required reserve ratio of 25 percent, and bank reserves of $100,000. Then this bank can make new loans in the amount of
A. $20,000. B. $100,000. C. $50,000. D. $25,000.