At the interest rate r, the price of a depletable natural resource three years from the present (price in present = P) will be, everything else being equal, which of the following?
a. 3P
b. P3
c. P(1 + r)3
d. 3P(1 + r)3
c
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When negative externalities exist, the private market equilibrium represents a
A) market price which is too low and a market quantity which is too low. B) market price which is too low and a market quantity which is too high. C) market price which is too high and a market quantity which is too low. D) market price which is too high and a market quantity which is too high.
Consider the production possibilities frontier in the figure shown. The opportunity cost of moving from point A to point B is:
A. 5 cars per cigar.
B. 10 cars per cigar.
C. 5 cigars per car.
D. 10 cigars per car.
In the long run,
a. continuing budget surpluses cause interest rates to fall, thereby stimulating investment spending b. any deviation from a balanced budget will plunge the economy into recession c. there can be no economic growth unless the government's budget is in surplus d. there can be no economic growth unless the government's budget is balanced e. government spending must increase as a fraction of GDP
Suppose the U.S. GDP growth rate is faster relative to other countries' GDP growth rates. U.S. imports will therefore increase faster than U.S. exports, and this will
A) move the economy up along a stationary aggregate demand curve. B) move the economy down along a stationary aggregate demand curve. C) shift the aggregate demand curve to the left. D) shift the aggregate demand curve to the right.