The assumption that "other things are constant" is also known as the
A. distinguishing characteristic of economics as a science.
B. ceteris paribus assumption.
C. relationships assumption.
D. rational self-interest assumption.
Answer: B
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An open market ________ by the Fed increases the money supply, which leads to ________ interest rates and increased GDP
A) sale; decreased B) purchase; decreased C) purchase; increased D) sale; increased
In the Classical view, inflation is the result of
A) excessive monetary growth. B) speculation. C) government spending. D) natural disasters.
The spirit of equating marginal cost with marginal revenue is NOT held by:
A. oligopolistic firms. B. perfectly competitive firms. C. perfectly competitive firms and oligopolistic firms. D. None of the answers is correct.
Which of the following is a microeconomic question?
A. Should the government decrease unemployment benefits to reduce the unemployment rate? B. Why do some countries have higher inflation rates than other countries? C. Should the government subsidize corn farmers to encourage the production of ethanol? D. Should congress decrease taxes to help stimulate the economy?