Because of the relationship among ethanol production, sugar, and corn the authors of your text have concluded that:
a. the corn subsidy is a big problem for ethanol exports.
b. the sugar quota makes sugar so cheap in the United States that ethanol producers are using it instead of corn.
c. due to the sugar quota and its high price, there is a huge demand for less environmentally friendly corn as a substitute in food products and for ethanol.
d. ethanol should be imported rather than exported.
Ans: c. due to the sugar quota and its high price, there is a huge demand for less environmentally friendly corn as a substitute in food products and for ethanol.
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An economy with an expansionary gap will, in the absence of stabilization policy, eventually experience a(n) ________ in the inflation rate, leading to a(n) ________ in output.
A. decrease; increase B. increase; increase C. decrease; decrease D. increase; decrease
Over time, which of the following will most likely result from a depreciation in the exchange rate of the dollar?
a. Inflation will decline. b. Foreign goods will cost Americans less, and therefore, the imports of Americans will rise. c. U.S. goods exported abroad will cost less in foreign countries, so foreigners will buy more of them. d. U.S. goods exported abroad will cost more in foreign countries, so foreigners will buy fewer of them.
Suppose the economy experiences a recessionary gap. Expansionary monetary policy will
A) increase real GDP and increase the price level. B) increase real GDP and decrease the price level. C) decrease real GDP and increase the price level. D) decrease real GDP and decrease the price level.
Which of the following statements describes a supply curve?
a. A supply curve is a graphic illustration of the relationship between supply, shown on the vertical axis, and demand, shown on the horizontal axis. b. A supply curve is a graphic illustration of the relationship between price, shown on the horizontal axis, and quantity, shown on the vertical axis. c. A supply curve shows the same information as a supply schedule. d. A supply curve shows the same information as a demand schedule.