Which of these changes is likely to follow when the Fed sells U.S. government securities?
What will be an ideal response?
Planned investment spending will decrease.
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Refer to Figure 10.7. A movement from point B to point D could be caused by
A) an increase in the target interest rate. B) an increase in consumer confidence. C) an increase in the term structure effect. D) a decrease in the expected rate of inflation.
Applying the concept of labor specialization to international trade, if all countries specialize in producing what they do relatively best,
a. each country could become self-sufficient b. international specialization and exchange will benefit the producers but harm the consumers c. consumers are better off, but producers are worse off d. inefficiency in production occurs because specialization, although allowing for moreproduction, causes people to know less about the "big picture" e. there will be more goods produced, exchanged, and consumed
Jerry's Marginal Utility for consuming beer and pizza with $8.00 in income
Referring to the above table, suppose Jerry's ratios of marginal utility of beer to the price of beer and the marginal utility of hotdogs to the price of hotdogs are equal. If the price of beer increases
A. Jerry will probably consume less beer and fewer hotdogs. B. Jerry will probably consume less beer and more hotdogs. C. Jerry will probably consume more beer and fewer hotdogs. D. Jerry will still consume the same amount of beer and hotdogs.
The principle that the cost of something is equal to what is sacrificed to get it is known as the
A. principle of opportunity cost. B. marginal principle. C. reality principle. D. principle of diminishing returns.