A change in technology or the relative prices of the inputs used in a production process would cause a manager’s choice of inputs to use in the production process to change as well. Indicate whether the statement is true or false ANSWER TRUE
Date: September 10th, 2020
In an open economy, injections and leakages are related as: A) I + G = S + T. B) I + G + X = S + T + M. C) X + G = T + M. D) none of the above ANSWER B
Date: September 10th, 2020
Consumer debt increases. What is the impact on aggregate expenditures and income? A) Both increase. B) Both decrease. C) Aggregate expenditure increases and income decreases. D) Aggregate expenditure decreases and income increases. ANSWER B
Date: September 10th, 2020
The decision by the federal government to prohibit cigarette companies from advertising on television actually caused the companies’ profits to increase, an outcome that is consistent with the prediction of the prisoner’s dilemma game. Indicate whether the statement is true or false ANSWER TRUE
Date: September 10th, 2020
Which of the following is not considered a factor that influences supply? A) Technology. B) Production taxes and subsidies. C) The number of buyers. D) Resource prices. ANSWER C
Date: September 10th, 2020
When demand is unit elastic, an increase in price will cause total revenue to increase, stay the same, or decrease, depending on the corresponding change in quantity demanded. Indicate whether the statement is true or false ANSWER FALSE
Date: September 10th, 2020
If desired spending exceeds output, then firms: A) accumulate their inventories and cut production. B) deplete their inventories and cut production. C) deplete their inventories and increase production. D) accumulate their inventories and increase production. ANSWER C
Date: September 10th, 2020
All else constant, all of the following would cause the demand curve for a good to shift except: A) a change in the cost of producing the good. B) a change in the price of a related good. C) a change in consumer’s incomes. D) a change in the number of buyers. ANSWER A
Date: September 10th, 2020
A major weakness of the kinked demand curve model is that it does not explain how the equilibrium price, i.e., the price at the kink in the demand curve, is determined. Indicate whether the statement is true or false ANSWER TRUE
Date: September 10th, 2020
The aggregate expenditure in an open economy is defined as: A) E = C + I + G. B) E = C + I + G + X. C) E = C × I × G × X – M. D) E = C + I + G + X – M. ANSWER D
Date: September 10th, 2020
