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; decrease
C. increase; increase
D. decrease; decrease
Answer: B
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The United States is a leading exporter of wheat. What explains the source of the comparative advantage of the United States in wheat production?
A) positive externalities B) investment by multinational firms such as Archer-Daniels-Midland and Tyson Foods Inc. C) climate and soil conditions in the United States which are well-suited for wheat production D) a large supply of unskilled labor
Consumer surplus in a market for a product would be equal to the area under the demand curve if
A) producer surplus was equal to zero. B) marginal cost was equal to the market price. C) the product was produced in a perfectly competitive market. D) the market price was zero.
Refer to the figure below. What is the price elasticity of supply at point A? 
A. 2 B. 4 C. 1/2 D. 1
Which of the following is an example of a person or firm that is most likely to have been granted a public franchise?
A) medical doctor B) taxi cab driver C) the local pizza parlor D) the local telephone company E) the local Honda dealership