Economics is best defined as the study of
A. inflation, unemployment, and economic growth.
B. how consumers make purchasing decisions.
C. choices made by people faced with scarcity.
D. financial decision making.
Answer: C
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Refer to Figure 13-3. Suppose the economy is at point A. If the economy experiences a supply shock, where will the eventual short-run equilibrium be?
A) A B) B C) C D) D
Before 1980, most U.S. corporations raised funds
A) in U.S. stock and bond markets or in foreign capital markets. B) in U.S. banks or in foreign capital markets. C) in U.S. stock and bond markets or in U.S. banks. D) in U.S. and foreign banks.
Price bubble occurs when
A) price of an asset soars far above "fundamentals" like corporate earning or household income. B) people can no longer afford to purchase an asset. C) economy enters recessionary period. D) economy experiences prolonged and slow recovery.
Under a flexible exchange rate system, exchange rates are determined by free markets.
Answer the following statement true (T) or false (F)