Suppose Colin brews beer and makes cheese. If Colin can increase his production of beer without decreasing his production of cheese, then he is producing at an:
A. inefficient point.
B. unattainable point.
C. efficient point.
D. ideal point.
Answer: A
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If the price elasticity of supply for a good is 0.75, then
A) the percentage change in the quantity supplied is less than the percentage change in price. B) the supply is elastic. C) an increase in the price boosts the quantity supplied by a larger percentage. D) the supply is inelastic so the demand must also be inelastic. E) None of the above answers is correct.
The Federal Reserve's ability to control the amount of demand deposits in the system depends on its ability to
A) clear checks. B) charter national banks. C) print currency. D) regulate bank reserves.
Which of the following is included in the study of macroeconomics?
a. Wage rate of college students. b. Prices of automobiles. c. Unemployment in the nation. d. Price of silver and gold.
When will speculators' actions raise social welfare?
a. Always. b. When they drive down market prices. c. When their expectations prove to be correct. d. When they are not risk averse.