41) The natural rate hypothesis concludes that the inflation rate increases, then in the short run there is A) an upward movement along the short-run Phillips curve. B) a downward movement along the short-run Phillips curve. C) an upward shift of the short-run Phillips curve. D) a downward shift of the short-run Phillips curve. E) no change at all in the short-run Phillips […]

  11) Which of the following is NOT a major argument for restricting international trade? A) the promotion of dumping in America B) the national security argument C) the infant industry argument D) the prevention of dumping argument E) saves U.S. jobs argument 12) Suppose the United States subsidizes domestic chicken production and then sells surpluses on the world market at a price below the […]

    41) When aggregate planned expenditure ________ real GDP, there are unplanned ________ in inventories, and firms ________ production, therefore decreasing real GDP. A) is less than; increases; decrease B) exceeds; decreases; decrease C) is less than; increases; increase D) exceeds; increases; increase E) is less than; decreases; decrease   42) If aggregate planned expenditures are less than real GDP, then A) inventories increase […]

  41) The figure above shows Lauren’s demand curve for Barbie dolls and the market price for Barbie dolls. Using the area of the consumer surplus triangle, Lauren’s total consumer surplus from purchasing 3 dolls is A) $5.50. B) $10.00. C) $22.50. D) $45.00. E) 3 dolls. 42) The figure above shows Lauren’s demand curve for Barbie dolls and the market price for Barbie dolls. […]

    31. Felton Inc. had the following information related to last year’s purchases:  Cost of goods sold $600,000 Accounts payable – beginning 25,000 Accounts payable – ending 40,000     What amount would be reported as “cash outflows for purchases” on the statement of cash flows using the direct method? A. $615,000B. $585,000C. $665,000D. $535,000   32. Crenshaw Inc. had the following information related to last year’s purchases:  Cost of goods […]

  11) There will be no gains from specialization and trade between two countries if 1) neither country has an absolute advantage in the production of any good; 2) neither country has a comparative advantage in the production of any good; 3) opportunity costs are the same in the two countries. A) 1 only B) 2 only C) 3 only D) 1 and 2 E) […]

    19.7   The External Balance Problem of the United States Under Bretton Woods   1) The confidence problem of the Bretton Woods systems articulated by Robert Triffin refers to A) the unwillingness of central banks to accumulate currency for fear of not being able to convert it to gold in case a run on the banks occurs. B) consumer fear of stock market instability. […]

    91) ________ refers to the use of relevant text ads that appear as sponsored links along with the results of a particular word search in a search engine. A) Product placement B) Keyword advertising C) Flyposting D) Banner advertising   92) Just Casuals, a brand of street wear in California, recently advertised its newly launched line of clothing. The firm pays Spyder, a […]

  111.Supposethepricelevelrises,butthenumberofdollarsyouarepaidperhourstaysthesame.Thismeansthatyour a.nominalwageishigher. b.nominalwageislower. c.realwageishigher. d.realwageislower. 112.Yourspousecomplainsthather6%raisethisyearwillnotkeepupwiththeincreaseinprices.Inotherwords,sheisunabletobuythesamebasketofgoodswithher6%raise.Therefore,shebelievesthather a.nominalincomeandrealincomeincreased. b.nominalincomeincreased,buttheirrealincomedecreased. c.nominalincomeandrealincomedecreased. d.nominalincomedecreased,buttheirrealincomeincreased. 113.Youfindthattoattractasufficientnumberofworkersyouhavetopaythemmoredollars.Giventhepriceofyouroutputyoudetermineyouarepayingyourworkersmoreingoodsthanbefore.Whichofthefollowinghasrisen? a.Therealandnominalvalueofthewagesyoupay. b.Therealbutnotthenominalvalueofwagesyoupay. c.Thenominalbutnottherealvalueofthewagesyoupay. d.Neithertherealnorthenominalvalueofthewagesyoupay. 114.Supposeeachgoodcosts$5perunitandMeganholds$40.Whatistherealvalueofthemoneysheholds? a.$40.Ifthepriceofgoodsrises,tomaintaintherealvalueofhermoneyholdingssheneedstoholdmoredollars. b.8unitsofgoods.Ifthepriceofgoodsrises,tomaintaintherealvalueofhermoneyholdingssheneedstoholdmoredollars. c.$40.Ifthepriceofgoodsrises,tomaintaintherealvalueofhermoneyholdingssheneedstoholdfewerdollars. d.8unitsofgoods.Ifthepriceofgoodsrises,tomaintaintherealvalueofhermoneyholdingssheneedstoholdfewerdollars. 115.Supposeeverygoodcosts$8perunitandMollyholds$120.Whatistherealvalueofthemoneysheholds? a.$120.Ifthepriceofgoodsrises,tomaintaintherealvalueofhermoneyholdingssheneedstoholdmoredollars. b.$120.Ifthepriceofgoodsrises,tomaintaintherealvalueofhermoneyholdingssheneedstoholdfewerdollars. c.15unitsofgoods.Ifthepriceofgoodsrises,tomaintaintherealvalueofhermoneyholdingssheneedstoholdmoredollars. d.15unitsofgoods.Ifthepriceofgoodsrises,tomaintaintherealvalueofhermoneyholdingssheneedstoholdfewerdollars. 116.Supposeicecreamconescosts$3.Mollyholds$60.Whatistherealvalueofthemoneysheholds? a.$60.Ifthepriceoficecreamconesrises,tomaintaintherealvalueofhermoneyholdingssheneedtoholdmoredollars. b.$60.Ifthepriceoficecreamconesrises,tomaintaintherealvalueofhermoneyholdingssheneedtoholdfewerdollars. c.20icecreamcones.Ifthepriceoficecreamconesrises,tomaintaintherealvalueofhermoneyholdingssheneedstoholdmoredollars. d.20icecreamcones.Ifthepriceoficecreamconesrises,tomaintaintherealvalueofhermoneyholdingssheneedstoholdfewerdollars. 117.Onitswebsite,yourbankpoststheinterestratesitispayingonsavingsaccounts.Thosepostedrates a.andapriceindexarebothrealvariables. b.andapriceindexarebothnominalvariables. c.arerealvariables,andapriceindexisanominalvariable. d.arenominalvariables,andapriceindexisarealvariable 118.Interestratesadjustedfortheeffectsofinflation a.andinflationarenominalvariables. b.andinflationarerealvariables. c.arerealvariables;inflationisanominalvariable. d.arenominalvariables;inflationisarealvariable. 119.Youputmoneyinthebank.Theincreaseinthedollarvalueofyoursavings a.andthechangeinthenumberofgoodsyoucanbuywithyoursavingsarebothnominalvariables. b.andthechangeinthenumberofgoodsyoucanbuywithyoursavingsarebothrealvariables. c.isanominalvariable,butthechangeinthenumberofgoodsyoucanbuywithyoursavingsisarealvariable. d.isarealvariable,butthechangeinthenumberofgoodsyoubuywithyoursavingsisanominalvariable. 120.Kellyputsmoneyinasavingsaccount.Oneyearlatershehastwopercentmoredollarsandcanbuythreepercentmoregoods.Kellyearnedarealinterestrateof a.twopercentandpricesfellonepercent. b.twopercentandpricesroseonepercent. c.threepercentandpricesroseonepercent. d.threepercentandpricesfellonepercent.    

  11.WhenthenationofDuxembourgallowstradeandbecomesanimporterofsoftware, a.residentsofDuxembourgwhoproducesoftwarebecomeworseoff;residentsofDuxembourgwhobuysoftwarebecomebetteroff;andtheeconomicwell-beingofDuxembourgrises. b.residentsofDuxembourgwhoproducesoftwarebecomeworseoff;residentsofDuxembourgwhobuysoftwarebecomebetteroff;andtheeconomicwell-beingofDuxembourgfalls. c.residentsofDuxembourgwhoproducesoftwarebecomebetteroff;residentsofDuxembourgwhobuysoftwarebecomeworseoff;andtheeconomicwell-beingofDuxembourgrises. d.residentsofDuxembourgwhoproducesoftwarebecomebetteroff;residentsofDuxembourgwhobuysoftwarebecomeworseoff;andtheeconomicwell-beingofDuxembourgfalls. 12.Whenanationfirstbeginstotradewithothercountriesandthenationbecomesanimporterofcorn, a.thisisanindicationthattheworldpriceofcornexceedsthenation’sdomesticpriceofcornintheabsenceoftrade. b.thisisanindicationthatthenationhasacomparativeadvantageinproducingcorn. c.thenation’sconsumersofcornbecomebetteroffandthenation’sproducersofcornbecomeworseoff. d.Alloftheabovearecorrect. 13.Whenanationfirstbeginstotradewithothercountriesandthenationbecomesanexporterofsoybeans, a.thisisanindicationthattheworldpriceofsoybeansexceedsthenation’sdomesticpriceofsoybeansintheabsenceoftrade. b.thisisanindicationthatthenationhasacomparativeadvantageinproducingsoybeans. c.thenation’sconsumersofsoybeansbecomeworseoffandthenation’sproducersofsoybeansbecomebetteroff. d.Alloftheabovearecorrect. 14.Traderaisestheeconomicwell-beingofanationinthesensethat a.thegainsofthewinnersexceedthelossesofthelosers. b.everyoneinaneconomygainsfromtrade. c.sincecountriescanchoosewhatproductstotrade,theywillpickthoseproductsthataremostbeneficialtosociety. d.thenationjoinstheinternationalcommunitywhenitbeginstoengageintrade. 15.Whenacountryallowstradeandbecomesanexporterofagood, a.thegainsofthedomesticproducersofthegoodexceedthelossesofthedomesticconsumersofthegood. b.thegainsofthedomesticconsumersofthegoodexceedthelossesofthedomesticproducersofthegood. c.thelossesofthedomesticproducersofthegoodexceedthegainsofthedomesticconsumersofthegood. d.thelossesofthedomesticconsumersofthegoodexceedthegainsofthedomesticproducersofthegood. 16.Whenacountryallowstradeandbecomesanimporterofcoal, a.thelossesofthedomesticproducersofcoalexceedthegainsofthedomesticconsumersofcoal. b.thelossesofthedomesticconsumersofcoalexceedthegainsofthedomesticproducersofcoal. c.thegainsofthedomesticproducersofcoalexceedthelossesofthedomesticconsumersofcoal. d.thegainsofthedomesticconsumersofcoalexceedthelossesofthedomesticproducersofcoal. 17.Whenacountryallowstradeandbecomesanexporterofagood,whichofthefollowingisnotaconsequence? a.Thepricepaidbydomesticconsumersofthegoodincreases. b.Thepricereceivedbydomesticproducersofthegoodincreases. c.Thelossesofdomesticconsumersofthegoodexceedthegainsofdomesticproducersofthegood. d.Thegainsofdomesticproducersofthegoodexceedthelossesofdomesticconsumersofthegood. 18.Whenacountryallowstradeandbecomesanimporterofbottledwater,whichofthefollowingisnotaconsequence? a.Thegainsofdomesticconsumersofbottledwaterexceedthelossesofdomesticproducersofbottledwater. b.Thelossesofdomesticproducersofbottledwaterexceedthegainsofdomesticconsumersofbottledwater. c.Thepricepaidbydomesticconsumersofbottledwaterdecreases. d.Thepricereceivedbydomesticproducersofbottledwaterdecreases. 19.Whenacountryallowstradeandbecomesanexporterofagood, a.consumersurplusandproducersurplusbothincrease. b.consumersurplusandproducersurplusbothdecrease. c.consumersurplusincreasesandproducersurplusdecreases. d.consumersurplusdecreasesandproducersurplusincreases. 20.Whenacountryallowstradeandbecomesanimporterofagood, a.consumersurplusandproducersurplusbothincrease. b.consumersurplusandproducersurplusbothdecrease. c.consumersurplusincreasesandproducersurplusdecreases. d.consumersurplusdecreasesandproducersurplusincreases. Figure9-1   ThefigureillustratesthemarketforcoffeeinGuatemala.