If a poor country is going to grow rapidly and achieve a high level of per capita income, which of the following is most important?
a. abundant natural resources
b. substantial aid from rich countries
c. central planning and a high level of government expenditures
d. institutions and policies that encourage productive activities
D
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When Ben Bernanke referred to the exit strategy of the Fed, he was referring to:
A) his plans to retire as chair of the Fed B) when the Fed would stop implementing monetary policy C) the process by which the Fed would shrink its balance sheet D) increasing the federal funds rate back to where it was prior to the financial crisis
A construction company builds roads with machinery (capital, K) and labor (L)
If we plot the isoquants for the production function so that labor is on the horizontal axis, then a point on the isoquant with a small MRTS (in absolute value) is associated with high ________ use and low ________ use. A) labor, capital B) capital, labor C) concrete, gravel D) none of the above
If the Fed were to purchase euros for dollars and at the same time sell U.S. Treasury securities in the open market, this would be an example of:
A. the Fed not changing their balance sheet at all. B. the Fed altering the domestic monetary base. C. an unsterilized foreign exchange intervention. D. a sterilized foreign exchange intervention.
Assume that coffee and tea are substitutes. Given a downward sloping demand curve for tea, an increase in the price of tea will cause
A) an increase in the demand for coffee. B) a decrease in the demand for coffee. C) a leftward shift of the demand curve for tea. D) a leftward shift in the demand for coffee.