When the housing bubble popped, the effect of the negative demand side shock and the negative supply side shock were the same on:
A. output, causing it to definitely decrease.
B. prices, causing them to definitely rise.
C. output, causing it to definitely increase.
D. prices, causing them to definitely fall.
Answer: A
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Economists have found that entrepreneurs are likely to have subjective beliefs about the probability of entrepreneurial success that are higher than the actual objective probabilities. These beliefs are most closely related to which of the following behavior concepts?
a. People are overconfident b. People give too much weight to a small number of vivid observations. c. People are reluctant to change their minds. d. People are inconsistent over time.
Your visit to the dentist, college tuition, and any commissions earned by a used car salesman are all included in GDP.
Answer the following statement true (T) or false (F)
When interest rates in the U.S. decline, we can expect net capital outflow to:
A. increase. B. be zero. C. decrease. D. be unaffected.
Refer to Figure 2.1. If you are producing 600 tons of agricultural products per year, what is the maximum amount of manufactured products you can produce per year?
A) 300 tons B) 500 tons C) 600 tons D) 700 tons