Economists typically define money as:
A. anything in which its value can be inflated.
B. a means of payment that lacks intrinsic value.
C. currency that is issued by a central bank.
D. a widely accepted means of payment.
Ans: D. a widely accepted means of payment.
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If the full-employment quantity of labor increases, then the
A) LAS curve shifts rightward and the SAS curve does not shift. B) SAS curve shifts rightward and the LAS curve does not shift. C) SAS curve shifts rightward and the LAS curve shifts rightward. D) SAS curve shifts rightward and the LAS curve does shifts leftward.
Many central banks, by law, focus only on inflation, but one of the laws governing the Federal Reserve mandates that the Federal Reserve focus on maintaining
a. high inflation and full employment. b. low inflation and high employment. c. high inflation and high employment. d. low inflation and full employment.
An example of foreign direct investment is the
A. domestic acquisition of less than 10 percent of a foreign company. B. purchase of livestock from abroad. C. sale of insurance in a foreign nation. D. foreign purchase of an entire domestic company.
Refer to the information provided in Figure 5.6 below to answer the question that follows.
Figure 5.6Refer to Figure 5.6. The market is initially in equilibrium at Point A and supply shifts from S1 to S2. Which of the following statements is true?
A. There is no need for price to serve as a rationing device in this case because the new equilibrium quantity exceeds the original equilibrium quantity. B. The market cannot move to a new equilibrium until there is also a change in demand. C. Price will still serve as a rationing device causing quantity supplied to exceed 12 thousand pizzas. D. Price will still serve as a rationing device causing quantity demanded to fall from 12 to 10 thousand pizzas.