"Economics deals with human needs." Do you agree or disagree? Why?
What will be an ideal response?
Disagree. The concept of needs is difficult to define objectively for each person, so that economists consider people's unlimited wants instead of their needs.
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All of the following are advantages of partnerships except one. Which is the exception?
a. they are relatively easy to start b. their profits are taxed once as personal income c. their liability is limited by each partner's share of the business d. a greater opportunity for specialization by the owners e. a continuation of the firm if one partner dies
Suppose Fred's marginal utility of an extra dollar of income is 56, and Sally's is 34 . If a dollar is taken from
a. Sally and given to Fred, the economy's total utility will rise by 22 units b. Fred and given to Sally, the economy's total utility will rise by 22 units c. Sally and given to Fred, the economy's total utility will rise by 34 units d. Sally and given to Fred, the economy's total utility will rise by 56 units e. Fred and given to Sally, the economy's total utility will rise by 34 units
Suppose that monetary neutrality and the Fisher effect both hold. An increase in the money supply growth rate increases
a. the inflation rate and nominal interest rates. b. the inflation rate, but not nominal interest rates. c. nominal interest rates, but not the inflation rate. d. neither the inflation rate nor nominal interest rates.
All of the following statements are true except
A. Until 1971 the United States had run a trade surplus virtually every year of the 20th century. B. The U.S. ran relatively small trade deficits through most of the 19th century. C. The U.S. was the only industrial power to raise tariffs during the 1930s. D. World trade in the 1930s dwindled to a fraction of what it had been in the 1920s.