Which of the following pairs is the best example of substitutes?
a. Coffee and cream. b. Honey and biscuits.
c. Tortillas and salsa. d. Hiking boots and athletic shoes.
d
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Which of the following real-world phenomena does the classical model ignore?
a. Frictional unemployment b. Inflation c. Real output growth d. Cyclical unemployment e. Structural unemployment
According to the rational expectationists
A. even if there were a recession or substantial inflation, the best government policy would be to do nothing. B. the dramatic oil price shocks of 1973 and 1979 created declines in aggregate supply, lowering the natural level of real GDP. C. the prime economic mover is aggregate supply, not aggregate demand. D. All of the choices/statements are true.
The U.S. dollar exchange rate, e, where e is the nominal exchange rate expressed as Japanese yen per U.S. dollar, will appreciate when:
A. U.S. consumers increase their preference for Japanese cars. B. the U.S. Federal Reserve eases monetary policy. C. the Bank of Japan eases monetary policy. D. the Bank of Japan tightens monetary policy.
Refer to the information provided in Figure 2.4 below to answer the question(s) that follow.
Figure 2.4According to Figure 2.4, Point E necessarily represents
A. an impossible production point. B. overallocation of resources. C. only motorcycles being produced. D. technological advancement.