Macro Final

If Hosne must work 0.5 hour to make each purse, then her production possibilities frontier is based on how many hours of work? a. 2 hours b. 5 hours c. 20 hours d. 50 hours Purses: 10 max Wallet: 8 max

b

Equilibrium quantity must decrease when demand a. increases and supply does not change, when demand does not change and supply decreases, and when both demand and supply decrease. b.increases and supply does not change, when demand does not change and supply increases, and when both demand and supply decrease. c.decreases and supply does not change, when demand does not change and supply increases, and when both demand and supply decrease. d.decreases and supply does not change, when demand does not change and supply decreases, and when both demand and supply decrease.

a

The bowed shape of the production possibilities frontier can be explained by the fact that a. all resources are scarce. b. economic growth is always occurring. c. the opportunity cost of one good in terms of the other depends on how much of each good the economy is producing. d. the only way to get more of one good is to get less of the other.

c

Assume an economy experienced a positive rate of inflation between 2003 and 2004 and again between 2004 and 2005. However, the inflation rate was higher between 2004 and 2005 than it was between 2003 and 2004. Which of the following scenarios is consistent with this assumption? a. The CPI was 100 in 2003, 110 in 2004, and 105 in 2005. b. The CPI was 100 in 2003, 120 in 2004, and 135 in 2005. c. The CPI was 100 in 2003, 105 in 2004, and 130 in 2005. d. The CPI was 100 in 2003, 90 in 2004, and 88 in 2005.

d

If 2010 is the base year, then the inflation rate in 2015 equals a. CPI 2015- CPI 2014 / CPI 2010 b. CPI 2015- CPI 2010 / CPI 2010 c. CPI 2015- CPI 2010 / CPI 2014 d. CPI 2015- CPI 2014 / CPI 2014

d