ECON312N

The real wage rate is ​$12.00 an hour and the CPI is 110. What is the nominal wage​ rate?

$13.2 an hour

In 2008, U.S. exports of goods and services were $1,847 billion and imports were $2,557 billion. What was the value of net exports?

-710 billion dollars

One of the following statements is an example of a positive statement.

-It is possible to meet all our energy needs with renewable resources -Swimmers are getting faster

If nominal GDP increases by 5 percent a year and the GDP price index rises by 2 percent a​ year, then real GDP increases by​ _______.

3 percent a year

The interest rate is 22 percent a year in The Gambia and 7.5 percent a year in South Africa. The inflation rate is 14.2 percent a year in The Gambia and 1.4 percent a year in South Africa. Calculate the real interest rate in The Gambia and South Africa.

7.8 percent in Gambia 6.1 percent in South Africa

Which of the following is an example of a price cap regulation​?

A government regulation has forced cable TV operators to lower the price of cable TV from​ $55 a month to​ $30 a month.

Aqua Springs makes the following four statements about bottled spring water. Which statement best describes the firm's quantity supplied in the bottled water market?

At a price of $1 gallon, we plan to sell 2,000 gallons per day

Chained dollar real GDP is the measure of real GDP calculated by the

Bureau of Economic Analysis

M1

Currency and traveler's checks held by individuals and business + checkable deposits owned by individuals and businesses

In July 2013​, M1 was ​$2,549 ​billion; M2 was ​$10,710 ​billion; checkable deposits owned by individuals and businesses were ​$1,414 ​billion; small time deposits were ​$556 ​billion; and money market funds and other deposits were ​$665 billion. Calculate currency held by individuals and businesses and​ traveler's checks in July 2013​, and calculate savings deposits.

Currency held by individuals and businesses and​ traveler's checks were ​$1135 billion Savings deposits in July 2013 were ​$6940 billion

Who in the following statements is a discouraged worker​?

Dan is available to work but has not looked for a job in the past eight weeks because of repeated applications but no single offer.

Which of the following illustrates a tradeoff?

I will study for my exam instead of going to the movie tonight

Which of the following is an example of an export subsidy​?

The U.S. government pays farmers​ $100 per ton of sugar sold to Canada.

Identify which of the following questions is NOT a microeconomic question.

Why does the government spend more than it collects in taxes?

The fundamental force driving international trade is comparative​ _______.

advantage: the country with the lower opportunity cost of production exports the good

The government expenditure multiplier is the effect of a change in government expenditure on goods and services on​ _____.

aggregate demand

Demand-pull inflation is an inflation that starts because ___

aggregate demand increases

The balanced budget multiplier is the effect on​ _____ of a​ _____ change in government expenditure and taxes that leaves the budget balance unchanged

aggregate​ demand; simultaneous

An economy can achieve faster economic growth without

an increase in the population growth rate

Shari grows beautiful grows beautiful orchids. Her total fixed cost is ​$48 a​ day, and her average variable cost is ​$1 a plant. She is maximizing her profit by selling 12 orchids a day for ​$5 a plant. Few people know about Shari's Orchids. Shari thinks that if she spends ​$20 a day on​ advertising, she can sell 26 orchids a day for ​$5 a plant. If Shari's belief about the effect of advertising is​ correct, she ​______.

can increase her economic profit by advertising

Which method is used to allocate strategic resources in the military? Which method is used to allocate the Academy Awards​?

command; contest

All of the following are sources of inefficiency except​ ____

competition

A substitute is a good that is ___ another good, and a complement is a good that is ___ another good

consumed in place of; consumed together with

If Korea imposes an import quota on U.S.​ oranges, losers include Korean​ ______ of oranges and U.S.​ ______ of oranges.

consumers; producers

Full employment is when there is no​ _____ unemployment​ or, equivalently, when all the unemployment is​ _____ or​ _____.

cyclical; frictional; structural

All of the following are examples o scarcity except ___

deciding whether or not Pluto should be considered a planet

An increase in taxes when the economy is above full employment ​ ______ aggregate demand and real​ GDP, and the price level​ ______.

decreases; falls

Explain how aggregate demand changes when the government increases taxes by​ $100 billion. Aggregate demand​ ______ by​ ______ $100 billion.

decreases; more than

Full-employment equilibrium occurs when equilibrium real GDP ___

equals potential GDP

A recessionary gap is a gap that exists when potential GDP ___ real GDP and that brings a ___ price level. An inflationary gap is a gap that exists when real GDP ___ potential GDP and that brings a ___ price level

exceeds; falling exceeds; rising

A commodity or token is money if it is​ _______.

generally accepted as means of payment

Consumption expenditure flows from​ ______ to​ ______ through the​ ______ markets.

households; firms; goods

For consumers, ski trips and ski jackets are complements. If the price of a ski trip decreases, the demand for ski jackets will ___

increase, and the demand curve for ski jackets will shift rightward

The Fed fights inflation by​ _______.

raising the federal funds​ rate, which raises interest rates and decreases aggregate demand

Automatic stabilizers are features of fiscal policy that stabilize​ _____ without explicit action by the government.

real GDP

When the Fed raises the federal funds​ rate, the​ long-run real interest rate​ ______.

rises within a few months

When floods wiped out the banana crop in Central​ America, the equilibrium price of bananas​ ______ and the equilibrium quantity of bananas​ ______

rose; decreased

The​ Fed's policy tools include all the following except ​_______.

taxing​ banks' deposits at the Fed

When cyclical unemployment increases and other things remain the​ same, ______.

the natural unemployment rate does not change

Full employment is defined as a situation in which​ _______.

the unemployment rate equals the natural unemployment rate

The CPI basket consists of items that​ ______ buy and it is updated frequently to​ ______

urban​ households; reduce bias

Tax incidence is the division of the burden of a tax between the​ _____ and the​ _____.

​buyer; seller

Purchases of new national defense equipment flow from​ ______ to​ ______ through the​ ______ markets.

​governments; firms; goods

Other things remaining the​ same, the lower the real interest​ rate, the​ ______ is the amount of consumption expenditure and the​ ______ is the amount of saving. Other things remaining the​ same, the lower the real interest​ rate, the ___ is the amount of investment.

​greater; smaller greater

The federal funds rate is the interest rate at which banks can borrow and lend​ _____ in the​ _____ market.

​reserves; federal funds

Who in the following statements is a ​part-time worker for economic reasons​?

Sherrie is a graduate who started working at Safeway pharmacy for 4 hours each​ day, three days a​ week, as they do not currently have a​ full-time opening.

With free trade between China and the United​ States, the winners are​ ______ and the losers are​ ______.

U.S. consumers of U.S.​ imports; U.S. producers of the U.S. import good

The people who support restricted international trade say that​ ______.

U.S. firms​ won't be able to compete with​ low-wage foreign labor if trade is free

Choose the statement that is incorrect

We include a measure of good health and life expectancy in GDP

The nominal wage rate is the average​ _____ wage rate measured in​ _____ dollars. The real wage rate is the average​ _____ wage rate measured in the dollars of​ _____ year.

hourly; current; ​hourly; a reference base

Suppose that the U.S. government increases its expenditure on highways and bridges by​ $100 billion. As a result of this​ expenditure, aggregate demand​ ______. If the economy is in a​ recession, real GDP​ _______.

increases by more than​ $100 billion because consumption expenditure increases in a multiplier​ process; increases

A discouraged worker​ ______.

is a marginally attached worker who has not made specific efforts to find a job within the previous four weeks because previous unsuccessful attempts were discouraging

When the output gap is​ positive, the unemployment rate​ ______ the natural unemployment rate. When the output gap is​ negative, the unemployment rate​ ______ the natural unemployment rate.

is less​ than; is greater than

The money multiplier

is the number by which a change in the monetary base is multiplied to find the resulting change in the quantity of money.

Government debt

is the sum of past budget deficits minus the sum of past budget surpluses.

A real business cycle is a cycle that results from fluctuations in the pace of growth of ___ and ___

labor productivity; potential GDP

Which of the following is an example of an import quota​? The United States​ _____ .

limits the quantity of auto parts that U.S. car makers may buy from China

The​ Fed's "dual​ mandate" is to achieve​ ________.

low inflation and maximum employment

The methods that governments use to support farms​ vary, but they almost always include all of the following except​ _______.

lower taxes for farmers

The three vital functions that money performs are​ ______.

medium of​ exchange, unit of​ account, and store of value

Concerned about the political fallout from rising college tuition​, the U.S. government decides to impose a price ceiling on tuition of ​$30,000 a student. If more colleges open and drive the equilibrium price of tuition to ​$25 comma 00025,000 a student​, ​_____. The market for college education is​ ______.

neither a surplus nor a shortage of college education emerges​; efficient

According to classical macroeconomics ____

no remedy by the government can improve on the performance of the market

Suppose migration into the United States increases the working-age population. As a result there is ___ in the U.S. production function. There is ___ in the U.S. demand for labor and ___ in the U.S. supply of labor.

no shift; no change; an increase

Every day, we make many choices. We can't avoid having to make choices because___

our wants exceed the resources available to satisfy them.

Betsy graduates from college and her income increases by $25000. Nothing else changes. Betsy decreases the quantity of pasta and pretzels that she buys and increases the quantity of coffee that she buys. For Betsy, ___

pasta and pretzels are inferior goods

The ​working-age population is the total number of​ _____ aged​ _____ years and over who are not in​ jail, hospital, or some other form of institutional care or in the U.S. Armed Forces.

people; 16

An automatic stabilizer is at work if as real GDP​ increases, ______.

tax revenues increase and transfer payments decrease

If the BLS included all marginally attached workers as being​ unemployed, the​ _______ would be​ _______.

unemployment​ rate; higher

CPI measure the average price paid by ___ for ___

urban consumers; fixed basket of consumption goods and services

The opportunity cost of a pair of running shoes is best defined at the ___

value of the highest-valued alternative given up to get a pair of running shoes

The opportunity cost of a vacation is best defined as the ____

value of the highest-valued alternative given up to get a vacation

The BLS counts Jody as being unemployed if she​ _______.

wants a job and is willing to take a job but after searching last week cannot find a job

The nominal interest rate is 5 percent a year and the real interest rate is 7 percent a year. What is the inflation​ rate?

-2 percent a year

Suppose that in September 2009 in the United​ States, the monetary base in the United States was $625 ​billion, commercial banks' deposits at the Fed were $15 ​billion, and Federal Reserve notes were $600 billion. Calculate the quantity of coins

$10 billion

Suppose that at the end of December​ 2009, the quantity of coins was ​$15 ​billion, the monetary base in the United States was ​$635 ​billion, and banks' reserves at the Fed were ​$20 billion. Calculate the Federal Reserve notes

$600 billion

The BLS reported that in July 2017​, the labor force was 160.5 ​million, employment was 153.5 ​million, and the​ working-age population was 255.2 million. The BLS also reported thatnbsp 17.3 17.3 percent of all employment in July 2017July 2017 was part time and thatnbsp 5.3 5.3 million people worked part time for economic reasons. How many people worked part time for noneconomic​ reasons?

21.2 million

The BLS reported that in November 2017, the labor force was 160.5 ​million, employment was 153.5 ​million, and the​ working-age population was 255.2 million. Calculate the unemployment rate and the labor force participation rate. The unemployment rate is ___ percent. The labor force participation rate is ___ percent.

4.4 62.9

The Bureau of Labor Statistics reported that in June 2005​, the labor force was 151.1 ​million, employment was 143.3 ​million, and the​ working-age population was 226.2 million. In June 2005​, what was the unemployment rate and the labor force participation​ rate?

5.2 percent unemployment 66.8 percent labor force participation

The Bureau of Labor Statistics reported that in June, 2017​, the labor force was 160,494,000​, employment was 153,513,000​, and the​ working-age population was 255,151,000. Calculate for that month the labor force participation rate and the unemployment rate. The labor force participation rate was ___ percent. The unemployment rate was ___ percent.

62.9 4.3

Suppose that in an​ economy, investment is​ $160 billion, saving is​ $140 billion, government expenditure on goods and services is​ $150 billion, exports are​ $200 billion, and imports are​ $250 billion. ​______ in government expenditure or​ ______ in taxes will increase investment and speed economic growth.

A​ decrease; an increase

Bank's total deposits

Checkable deposits + savings deposits + small time deposits

Choose the statement that is incorrect.

Deposits are not money because you cannot settle a debt with a deposit.

Suppose that in an​ economy, investment is​ $400 billion, saving is​ $400 billion, tax revenues are​ $500 billion, exports are​ $300 billion, and imports are​ $200 billion. What is government expenditure and the government budget​ balance?

Government expenditure is ​$400 billion. The government budget balance is ​$100 billion.

M2

M1 + savings deposits + small time deposits + money market funds and other deposits

In December 2003​, currency and​ traveler's checks held by individuals and businesses was ​$670 ​billion; checkable deposits owned by individuals and businesses were ​$634 ​billion; savings deposits were ​$3,169 ​billion; small time deposits were ​$810 ​billion; and money market funds and other deposits were ​$796 billion. Calculate M1 and M2 in December 2003.

M1 = 1304 billion M2 = 6079 billion

Sara withdraws ​$1,000 from her checking account at Bank of​ America, keeps ​$200 in​ cash, and deposits the balance in her time deposit account at Citibank. What is the immediate change in M1 and​ M2?

M1 decreases by ​$800 and there is no change in M2.

The federal​ government's major outlay in its budget is​ ______ and its major source of revenue is​ ______.

Social Security and other​ benefits; personal income taxes

How do the​ Fed's monetary policy actions influence the exchange​ rate?

The Fed influences the exchange rate by changing the U.S. interest rate differential.

Choose the correct statement about the Fed and the FOMC.

The Fed provides banking services to banks and governments and the FOMC meets approximately every six weeks to review the state of the economy

Choose the statement that is incorrect.

The aim of a bank is to maximize the net worth of its depositors

The institutions that make up the banking system are​ ______.

The federal reserve, commercial banks, thrift institutions, and money market funds

Choose the statement that is incorrect.

The magnitude of the tax multiplier is larger than the government expenditure multiplier

A bank has the following deposits and​ assets: Checkable​ deposits, ​$300 Savings​ deposits, ​$1,400 Small time​ deposits, ​$650 Loans to​ businesses, ​$1,824 Outstanding credit card​ balances, ​$300 Government​ securities, ​$225 ​Currency, ​$1 Reserve account at the​ Fed, ​$6 Calculate the​ bank's total deposits and the amount of deposits that are part of M1 and M2.

The​ bank's total deposits are ​$2350. Deposits that are part of M1 are ​$300. Deposits that are part of M2 are ​$2350.

Which of the following is an example of absolute advantage?

Tom does his math homework in 2 hours while Harry takes only 30 minutes to do the same task

The economy is in a boom and the inflationary gap is large. Discretionary fiscal policy that might occur is​ ______.

a decrease in government expenditure and an increase in taxes

The​ supply-side effects of a tax cut arise because taxes act as ____ to​ work, save, and provide entrepreneurial services. The​ supply-side effects from an increase in government expenditure arise because government expenditure increases the quantities of ___ ​, which increases potential GDP and aggregate supply. So, a tax cut increases​ people's ___ to​ work, to​ save, and to provide entrepreneurial​ services, all of which lead to an increase in aggregate supply and potential GDP.

a disincentive; public goods and services; incentive

Suppose Dell introduces a new supercomputer that everyone can afford. As a result there is ___ in the U.S. production function and ___ in the U.S. demand for labor

an upward shift; an increase

The natural unemployment rate is the unemployment rate when the economy is​ _____.

at full employment

The structural surplus or deficit is the budget balance that would occur if the economy were​ _____.

at full employment

Classify each of the following items as discretionary fiscal policy or automatic fiscal policy or neither.

automatic - A decrease in tax revenues in a recession discretionary - Additional government expenditure to upgrade highways discretionary - An increase in the public education budget discretionary - A cut in infrastructure expenditure during a boom

A fall in income that results in a decrease in tax revenues is an example of​ ______.

automatic fiscal policy

Cost-push inflation is an inflation that begins with an increase in

cost

When the economy goes into​ recession, the biggest increase in unemployment is​ _______.

cyclical because jobs are lost in many industries as they cut production

To fight unemployment and close a recessionary​ gap, the Fed​ ________.

stimulates aggregate demand by lowering the federal funds​ rate, which increases the quantity of money

Macroeconomic equilibrium occurs when the quantity of real GDP ___ equals the quantity of ___

demanded; real GDP supplied

The natural unemployment rate is not zero because natural unemployment includes​ _______. The unemployment rate fluctuates around the natural unemployment rate because​ _______ during a recession and​ ___________ during an expansion.

frictional and structural unemployment; cyclical unemployment​ increases; decreases

A business cycle is a ___ but ___ up-and-down movement of total ___ and other measures of economic activity

periodic; irregular; production

Economic freedom is a condition in which people are able to make ___ choices, there private property is ___ and they ___ markets.

personal; protected by the rule of law; are free to buy and sell in

If in the short​ run, firms in monopolistic competition make _____ economic​ profit, then in the long​ run, new firms will enter the market. The​ ______ each individual​ firm's product will​ ______. In the new​ long-run equilibrium, firms will make _____ economic profit.

positive; demand for; decrease; zero

The output gap is real GDP minus​ _____ expressed as a percentage of​ _____.

potential​ GDP; potential GDP

The inflation rate is the percentage change in the​ _____ from one year to the next. Deflation is a situation in which the​ _____ is​ _____ and the inflation rate is​ _____.

price​ level; price​ level; falling; negative

Which of the following are included in the income approach to measuring GDP?

profit; indirect taxes less subsidies; wages

A commercial bank creates money when it does all the following except ​_______.

puts cash in its ATMs

An automatic fiscal policy is a fiscal policy action that is triggered by​ _____. A discretionary fiscal policy is a fiscal policy action that is initiated by​ _____.

the state of the​ economy; an act of Congress

Potential GDP is the value of real GDP when​ _______.

the unemployment rate equals the natural unemployment rate

Markets are a necessary precondition for economic growth because ___

they create incentives to save and invest

Keynes' theory was that ___

too little private spending is the cause of depression and recession

Market failure arises if ____

total surplus is not maximized

A country has been in existence for only two years. In the first​ year, tax revenues were​ $1.0 million and outlays were​ $1.5 million. In the second​ year, tax revenues were​ $1.5 million and outlays were​ $2.0 million. At the end of the second​ year, the government had issued debt worth​ ______.

​$1 million

Once a​ month, the Bureau of​ ______ Statistics calculates the Consumer Price​ Index, which is a measure of the​ ______ consumers for a fixed basket of consumer goods and services.

​Labor; average of the prices paid by urban

The monetary base is the sum of​ _______.

​coins, Federal Reserve​ notes, and​ banks' reserves at the Fed

Explain how aggregate demand changes when the government increases both expenditure on goods and services and taxes by​ $100 billion. Aggregate demand​ ______ because the increase in government expenditure has​ ______ effect on aggregate demand than the effect of the tax increase.

​increases; a larger

Explain the change in aggregate demand when government expenditure on national defense increases by​ $100 billion. Aggregate demand​ ______ by​ ______ $100 billion.

​increases; more than

U.S. national debt​ ______ when the federal​ government's ______.

​increases; outlays exceed tax revenue

Fiscal stimulus when the economy is below full employment​ ______ aggregate demand and real​ GDP, and the price level​ ______

​increases; rises

A decrease in tuition fees will decrease your​ college's total revenue if the price elasticity of demand for college education is​ _____

greater than zero and less than 1

When a firm decides to produce a good by using a capital intensive method, it is answering the ___ question. When a firm decides to produce computers rather than DVD players, it is answering the ___ question. Who gets the goods and services that are produces answers the ___ question.

how; what; for whom

Major league baseball is exempt from laws designed to limit market power and it operates as a monopoly. If the baseball market became​ competitive, the number of teams would​ ______ and the economic profit of each team would​ ______.

increase; decrease

You can stay in school or you can quit school and get a full-time job. Your rational choice will be to stay in school if ___

the net benefit from staying in school is greater than the net benefit from getting a full-time job

A black market that emerges as the result of a price ceiling is an illegal market in which​ _______

the price exceeds the legally imposed price ceiling

Normal profit is the return to​ _____. Normal profit is part of a​ firm's _____ cost because it is the cost of not running another firm.

​entrepreneurship; opportunity

Which of the following correctly lists the categories of factors of​ production?

​land, labor,​ capital, and entrepreneurship

A cartel is a group of firms acting together to​ _____ output,​ _____ price, and increase​ _____.

​limit; raise; economic profit

Choose the statement that is incorrect.

Oligopolies have a natural barrier preventing the entry of new firms.

The United States maintains an import quota on sugar. What is the argument for this import​ quota? The argument is​ ______ because​ ______

The import quota protects U.S. jobs. ​incorrect; sugar growers would be more efficiently employed producing things in which the United States has a comparative advantage

The dry cleaning industry is in monopolistic competition. In the short​ run, the​ profit-maximizing price is​ $10 per item and the average total cost is​ $6 per item. In​ long-run equilibrium, the​ profit-maximizing price is​ $8 per item. In​ long-run equilibrium, what is the economic profit of a firm in the dry cleaning​ industry? In​ long-run equilibrium, the dry cleaning firm makes ​______ economic profit.

$0

Poinsettia growing is a perfectly competitive industry and all poinsettia growers have the same cost curves. The market price of poinsettias is ​$9 a pot and each grower maximizes profit by producing 800 pots a week. The average total cost of producing poinsettias is ​$20 a pot. Minimum average variable cost is ​$8 a pot​, and the minimum average total cost is ​$12 a pot. In the long​ run, the market price of poinsettias is​ _____ a pot. In the long​ run, a poinsettia ​grower's economic profit is ___.

$12;$0

Rose growing is a perfectly competitive industry and all rose growers have the same costs. The market price of roses is ​$26 a bunch and each grower maximizes profit by producing 1,300 bunches a week. Average total cost of producing roses is ​$13 a bunch and average variable cost is ​$9 a bunch. Minimum average variable cost is ​$5 a bunch. What is the price at the​ grower's shutdown​ point?

$5 a bunch

The quantity demanded of good A decreases by 2 percent when the price of good B rises by 5 percent and other things remaining the same. The cross elasticity of demand of good A with respect to good B is negative ___. The cross elasticity of demand tells us that good A and good B are​ ______ and as the price of good B​ rises, the demand for good A​ ______.

-0.4; complements; decreases

When incomes in Detroit rise by 5 percent and other things remain the​ same, 1. the quantity demanded of frozen mixed vegetables decreases by 33 percent and 2. the quantity demanded of fresh asparagus increases by 12 percent. The income elasticity of demand for frozen mixed vegetables is ___

-0.6

When the price of a cup of coffee increases 10 ​percent, the quantity of donuts demanded decreases by 7 percent. Calculate the cross elasticity of demand for donuts with respect to the price of a cup of coffee. The cross elasticity of demand for donuts with respect to the price of a cup of coffee is ___. Coffee and donuts are ___

-0.7; complements

One of the following statements is an example of a normative statement.

-Workers must not be lazy -Poverty should be abolished

If the quantity demanded of noodles decreases by 24 percent when the price of noodles rises by 20 ​percent, what is the price elasticity of demand for noodles​?

1.2

When you pick apples for 3 hours, you pick 8 baskets of apples. And if you pick apples for an extra hour, you pick a total of 10 baskets. To study for the extra hour, you give up playing cards for that hour with your friends. The marginal benefit from picking apples one more hour is ___. The marginal benefit from picking apples is measured by ___.

2 baskets; the card game you are willing to give up

Elizabeth owns an ice cream parlor. In an hour she can produce 10 milkshakes or 30 sundaes. Ben also owns a parlor. In an hour he can produce 8 milkshakes or 8 sundaes. Elizabeth's opportunity cost of 1 milkshake is ____. Ben's opportunity cost of 1 milkshake is ____. ______ has comparative advantage in milkshakes.

3 sundaes; 1 sundae; Ben

The Social Network had world-wide box office receipts of $225 million. The movie had a production budget of $70 million and marketing costs of $50 million. ___ is a marginal cost that a producer of a movie faces. ___ is a marginal benefit that a producer of a movie receives.

All of the above; All of the above

Jeb makes the following four statements about peanuts. Which statement best describes his quantity demanded in the peanut market?

At a price of $1 per pack, I plan to buy 2 packs of peanuts per week

Former Venezuelan president Hugo Chavez opposed the creation of a Free Trade Area of the Americas​ (FTAA). ​Why? Who did he think would gain and​ lose? President Chavez thought that​ ______. A. poor workers in Venezuela would lose and rich American firms would win B. Venezuela would lose tariff revenue C. Venezuelans would lose because they would have to clean up their polluting industries D. Venezuelans would lose because the price of oil would fall E. Both A and B are correct Do you think he is​ correct?

Both A and B are correct; No, because greater free trade would bring gains for​ all, including​ low-income workers in Venezuela.

A tariff​ _______. A. enables the government to satisfy the​ self-interest of people who earn their incomes in​ import-competing industries B. is a tax imposed on a good when it is imported C. provides revenue to the government D. all of the above

D. All of the above

Which of the following activities is an example of dumping​?

Dell exports PCs to India at a price 20 percent lower than the cost of producing them.

Which of the following firms produce at the efficient scale​?

Dell produces 100 computers a week at which its average total cost is minimized.

The benefit of something is the ___

Gain or pleasure it brings

Which is an example of economics as a policy tool?

More students are taking out student loans

Indicate all the items in the following list that are not factors of production and explain why. Item a​: Trucks used by FedEx to make deliveries Item b​: Your dog Item c​: Undiscovered coal reserves Item d​: A garbage truck Item e​: A pack of bubble gum Item f​: The President of the United States

Items ​b, c, and e because they are not productive resources used to produce goods and services—​land, ​labor, capital, or entrepreneurship.

Which of the following countries is facing a recession

Japan's real GDP of 3.8 percent in the first quarter decreased by 0.3 and 0.4 percent respectively in the second and third quarters of 2012

Lizzie hires students at ​$60 a day to paint houses. She leases equipment that costs ​$90 a day. Suppose that Lizzie doubles the number of students she hires and doubles the amount of equipment that she leases. If Lizzie experiences diseconomies of scale​, her ​long-run average cost curve​ ______.

Slopes upward

Choose the correct statement

Social interest and self interest can come into conflict

Consider a perfectly competitive market in which all firms have the same costs. Choose the statement that is incorrect.

The market demand is perfectly elastic at the market price.

Consider the U.S. market for Caribbean cruises. Suppose cruising in the Caribbean becomes less popular. Explain the effect of this event on the quantity of Caribbean cruises demanded and on the demand for Caribbean cruises.

The demand for Caribbean cruises decreases

Consider the market for coffee. Suppose a study is published that says drinking coffee causes stomach ulcers. Explain the effect of this event on the quantity of coffee demanded and on the demand for coffee.

The demand for coffee decreases

In the market for steel, the price of a ton of steel falls. Explain the effect of this event on the quantity of steel supplied and on the supply of steel

The quantity of steel supplied decreases and the supply of steel is unchanged

If the government sets a price on dog food that is below the equilibrium​ price, ______.

a shortage of dog food occurs

Real GDP

does not accurately measure household production, underground economic activity, or life expectancy

Payments for labor services flow from​ ______ to​ ______ through the​ ______ markets.

firms; households; factor

Suppose that a new technology enables anyone with a small workshop to produce outstanding kayaks. You would expect​ ______ in production differentiation and​ ______ competition on product​ quality, price, and marketing.

an increase; more

In the United States today, three wants that are especially pressing and are not satisfied are ___

better public schools, a cure for cancer, and better public transportation systems

The tendency for the values of two variables to move in a predictable and related way is called ___

correlation

An economy that uses new technology___

experiences an outward shift of its PPF

Suppose that the world price of bananas is 18 U.S. cents a pound and that when Australia does not trade bananas​ internationally, the market price of bananas in Australia is 12 U.S. cents a pound. If Australia opens up to​ trade, Australia​ ______ bananas. The price of bananas in Australia​ ______. The quantity of bananas consumed in Australia​ ______ and the quantity of bananas grown in Australia​ ______.

exports; rises decreases; increases

The functional distribution of income shows the distribution of income among​ ______ and the personal distribution of income shows the distribution of income among​ ______.

factors of​ production; households

A 8 percent increase in the price of a good increased the quantity supplied of the good by 4 percent after one month. Supply of this good is ___. This good is most likely produced using factors of production that are ___. The price elasticity of this good is ___.

inelastic; unique or rare; 0.5

Indonesians bemoan Hollywood blockbuster blackout: The Indonesian import tariff on Hollywood movies was meant​ "to protect local film​ makers," but major Hollywood studios withdrew their films. Indonesia is using the​ ______ argument against free trade with the United States. ​Indonesia's argument is misguided because protected industries​ ______.

infant-industry; generally perform poorly and the country does not develop comparative advantage

When the price of a good increased by 8 ​percent, the quantity demanded of it decreased 4 percent. Most​ likely, this good​ ______ and ​ ______.

is a necessity; has poor substitutes

A firm is a natural monopoly if​ ______.

it can satisfy the market demand at a lower average total cost than other firms can

The price elasticity of demand for Fiona's popcorn is 1.5. Fiona wants to increase her total revenue. Fiona should ___ the price of her popcorn because the demand for popcorn is ___.

lower; elastic

A country that trades internationally imports a good at a price​ ______ than what domestic producers could produce the good for before the country began to trade internationally and exports a good at a price​ ______ than what domestic producers could sell the good for before the country began to trade internationally.

lower; higher

What you get from a one-unit increase in an activity that you enjoy is called ___.

marginal benefit

Your school has decide to increase the intake of new students next year. What economic concepts would your school consider in reaching its decision? Would the school use the "economic way of thinking" and make its decision at the margin?

marginal benefit and marginal cost Yes: it would consider the marginal benefit and marginal cost of a student

National comparative advantage arises from the differences in​ _______ across countries. If country A has a comparative advantage in the production of automobiles and country B has a comparative advantage in the production of​ boats, ______.

opportunity cost both countries will gain if country A exports automobiles to country B and country B exports boats to country A

When new and better ways of producing all goods and services are discovered or when the quantity of capital increases, ___

our economy grows, but we still face scarcity and opportunity cost

A demand schedule is a list of the ___ at each different price when all other influences on buying plans remain the same. A demand curve is a graph of ___

quantities demanded; a demand schedule

A supply schedule is a list of the ___ at each different price when all other influences on selling plans remain the same. A supply curve is a graph of ___

quantities supplied; a supply schedule

An increase in the demand for hot dogs brings a ___ of hot dogs at the original price, and the price of a hot dog will ___

shortage; rise

In Music ​Ville, the price elasticity of demand for CD players is 1.3​, the income elasticity of demand for CD players is 0.4​, and the cross elasticity of demand for CD players with respect to MP3s is 0.1. CD players and MP3s are​ ______. If the price of an MP 3 increases by 2020 percent with no change in the price of a CD player, the number of CD players____ by ___ percent.

substitutes; increases; 2

Many Americans are selling their used cars and buying new​ fuel-efficient hybrids. Other things remaining the​ same, in the market for used​ cars, ______ and in the market for hybrids​ ______

supply increases and the price​ falls; demand increases and the price rises

Economic growth is defined as ___

sustained expansion of production possibilities

A positive relationship or direct relationship is a relationship between two variables that move in ___, and a negative or inverse relationship is a relationship between two variables that move in ___

the same direction; opposite directions

Taxes lead to​ _______ , and subsidies lead to​ _______. A regulation that puts a price cap on apartment rents leads to​ _______. A monopoly leads to​ _______

underproduction; overproduction underproduction; underproduction

Baird and Paxton are the only major producers of a special pet vaccine. Each company has developed a vaccine and aggressively advertises it. The two firms are locked in a​ duopolists' dilemma. The​ duopolists' dilemma facing Baird and Paxton is​ ______.

whether they could trust each other to raise the price of a vaccine and decrease advertising to raise economic profit

​______ are the​ ______ that we buy from people in other countries. ​______ are the​ ______ that we sell to people in other countries.

​Imports; goods and services Exports; goods and services