Double counting occurs when: A) inputs are included in the calculation of the gross domestic product. B) household production is included in the calculation of the gross domestic product. C) depreciation is included in the calculation of the gross domestic product. D) unsold inventories are included in the calculation of the gross domestic product. […]
If the Fed wants to increase the federal funds rate through open market operations, it ________. A) decreases tax rates B) buys bonds C) sells bonds D) increases tax rates ANSWER C
Data show that in 2012, the college enrollment in Lithasia increased. In the same year, the sale of hotdogs in Lithasia also increased. The relationship between college enrollment and the sale of hotdogs exhibits: A) a negative correlation. B) a zero correlation. C) a positive correlation. D) a causal relationshi ANSWER C
On an average, growth in per capita income is associated with a: A) fall in inequality. B) fall in poverty. C) rise in poverty. D) rise in inequality. ANSWER B
Assuming all else equal, if a household is pessimistic about future income, it is likely to cause a(n): A) shift in the current credit supply curve of the household to the right. B) downward movement along the current credit supply curve of the household. C) upward movement along the current credit supply curve of the […]
Holding money as a medium of exchange to make payments is A) the capital demand for money. B) the transactions demand for money. C) the precautionary demand for money. D) the asset demand for money. ANSWER B
Which of the following is likely to be included in a country’s Gross Domestic Product in a particular year? A) An unsold inventory of automobiles produced in that year B) The total amount steel used in the production of automobiles in that year C) The total amount of flour used by bakeries to make bread […]
Which of the following statements is true? A) Economic growth is the direct cause of declining poverty. B) Growth in unemployment is the direct cause of declining poverty. C) There are some countries where growth and poverty have both increased. D) Economic growth is the direct cause of declining inequality. ANSWER C
Alberto purchases ten cups of coffee a week. The amount of money that he holds to purchase ten cups of coffee is the A) asset demand for money. B) precautionary demand for money. C) money balance demand for money. D) transactions demand for money. ANSWER D
Assuming all else equal, any change that causes a decrease in the credit supply at a given real interest rate will cause: A) the credit supply curve to shift to the right. B) an upward movement along the credit supply curve. C) a downward movement along the credit supply curve. D) the credit supply curve […]
