If the budget line shifts from BB to bb in the diagram, we can infer that the:
A. price of Y has increased and the price of X has decreased.
B. price of Y has decreased and the price of X has increased.
C. prices of both X and Y have increased.
D. prices of both X and Y have decreased.
A. price of Y has increased and the price of X has decreased.
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An increase in the money supply would cause the IS curve to
A) shift up and to the right. B) shift down and to the left. C) remain unchanged. D) shift up and to the right only if people face borrowing constraints.
Which of the following explain(s) better the fact that computers are cheaper now than 10 years ago?
a. c and d. b. c and e. c. The technology used in the production of computers has improved during this period. d. Resources used in the production of computers have become cheaper during this period. e. The demand for computers has increased substantially during this period.
During a stock market bubble, the price/earnings [P/E] ratio:
a. hits high levels. b. falls to zero. c. becomes negative. d. remains constant. e. declines to a very low level.
(Appendix) If the cost of search is $3, and wages are uniformly distributed between $20 and $50, what is the smallest wage you should accept if you are risk neutral?
A. 28.73 B. $36.58 C. $33.42 D. $46.58