The production possibilities frontier model assumes which of the following?
A) Labor, capital, land, and natural resources are unlimited in quantity.
B) The economy produces only two products.
C) Production of any level of the two products that the economy produces is currently possible.
D) The level of technology is variable.
Answer: B
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Money serves as a medium of exchange means that
A) it benefits both buyers and sellers. B) it eliminates the need for barter. C) it reduces transaction costs. D) All of the above are correct.
A tax on an imported good is a(n)
A) quota. B) export. C) tariff. D) subsidy.
The Conference Board does a good job predicting recessions for reasons that include ________
A) a focus on fewer than five leading variables B) exclusive use of real-time data C) revisions of the components of its monthly index D) all of the above E) none of the above
If potential GDP for the fourth quarter of 2012 = $58.5 billion, and real GDP for the fourth quarter of 2012 = $53.7 billion, then the output gap was
A) -8.9%. B) -8.2%. C) 8.2%. D) 8.9%.