If peanuts were widely accepted for purposes of exchange, then
A) peanuts would be money.
B) peanuts would be less valuable than they are currently.
C) we would observe people using peanuts to purchase cars.
D) a and c
E) a and b
D
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What can we conclude if depreciation (consumption of fixed capital) exceeds gross domestic investment?
A. Net investment is negative. B. The economy is importing more than it exports. C. The economy's production capacity is expanding. D. Nominal GDP is rising but real GDP is declining.
Refer to Figure 15-5. If the monopolist charges price P* for output Q*, in order to maximize profit or minimize loss in the short run, it should
A) continue to produce because price is greater than average variable cost. B) shut down because price is greater than marginal cost. C) continue to produce because a monopolist always earns a profit. D) shut down because price is less than average total cost.
The Industrial Revolution
A) marked the beginning of significant economic growth in the world. B) produced goods exclusively using human or animal power. C) had no impact on standards of living in the world. D) started in France around the year 1750.
Assume that a low-wage contract is in force in the society, and the central bank follows a low-money-growth policy. Which of the following will be observed?
a. The actual inflation rate will match the low rate that people had expected. b. The actual inflation rate will be higher than the natural rate. c. The actual inflation rate will be higher than the low rate that people had expected. d. The actual inflation rate will be lower than the high rate that people had expected. e. The unemployment rate will be lower than the natural rate.