If the unemployment rate decreases from 9% to 6%, the economy will
A. move away from the ppf toward the origin.
B. remain on the ppf.
C. remain on the origin.
D. move closer to a point on the ppf.
Answer: D
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When the quantity of real GDP demanded exceeds the quantity of real GDP supplied, firms
A) increase production and prices. B) decrease production and prices. C) increase production and lower prices. D) decrease production and increase prices. E) do not change production because aggregate demand and potential GDP will adjust.
Which of the following is most likely to be an unintended effect of placing safety caps on medicines?
A) It is now harder for people to open their medicine containers. B) People leave their medicine containers open more often, which ends up making it easier for children to get into the medicine. C) Fewer people get sick and need medicine. D) Medicine prices fall sharply.
Fiona uses all of her income to purchase popcorn and butter. At any two points A and B on Fiona’s budget constraint,
a. Fiona is equally happy.
b. Fiona is spending more money on popcorn than she is spending on butter.
c. Fiona's income is different.
d. the price of popcorn relative to the price of butter is the same.
There is a positive relationship between two variables if:
A. they move in opposite directions. B. they move in the same direction. C. one variable changes and the other does not. D. neither variable moves.