New growth theorists conclude that A) invention is more important than innovation in spurring economic growth. B) economic growth can continue as long as we keep coming up with new ideas. C) rates of global economic growth are limited by the amount of raw materials available. D) the amount of technological innovation in an economy […]
The marginal propensity to consume (MPC) can best be defined as that fraction of A) real disposable income that is not consumed. B) a change in real disposable income that is spent. C) a change in real disposable income that is saved. D) real disposable income that is consumed. ANSWER B
The direct exchange of goods and services for other goods and services without the use of money is A) barter. B) financial intermediaries. C) a store of value. D) a standard of deferred payment. ANSWER A
Which of the following is likely to lead to a right shift in the supply curve of cotton? A) A rise in labor costs due to wage demands by labor unions B) A decrease in the price of cotton C) An increase in labor productivity due to training programs D) An increase in the price […]
The development of human capital A) is a form of investment. B) enhances economic growth, but the individuals acquiring the capital are not made better off themselves. C) does not appear to enhance economic growth. D) enhances economic growth, but it does not improve the productivity of the labor force. ANSWER A
The term “free riders” refers to people who: A) selflessly pay for others’ consumption of goods and services. B) make economic decisions randomly and are not rational. C) haggle over the prices of the goods and services that they buy. D) don’t contribute but still benefit from others’ actions. ANSWER D
When the market for a commodity is in equilibrium: A) there will still be some unsold stock of the commodity. B) all sellers of the commodity will want to change their behavior. C) no economic agent will want to change his or her behavior. D) all buyers of the commodity will want to change their […]
Refer to the scenario above. What will be the difference in the GDP per capita of both countries at the beginning of year 2012? A) $30.39 B) $99.84 C) $8.99 D) $339.69 ANSWER B
Refer to the table above. If, at a price of $4 per loaf, the market supply of bread is 75 loaves, Seller 2’s supply is: A) 30 units. B) 35 units. C) 55 units. D) 20 units. ANSWER D
“Supply creates its own demand” implies that A) the very act of supplying a particular level of goods and services will not necessarily equal the level of goods and services demanded. B) the very act of demanding a particular level of goods and services necessarily equals the level of goods and services supplied. C) the […]
