61) If the current account balance is -$450 billion, the capital and financial account balance is $440 billion, then the official settlements balance is A) $10 billion. B) -$10 billion. C) $890 billion. D) -$890 billion. E) $0 because it is always zero.   62) Between 1981 and 2012, the United States A) had a current account deficit almost every year. B) had […]

    71.Which of the following groups would not be at risk for developing a thiamin deficiency? a.people who are addicted to alcohol b.people who consume polished rice as a food staple c.people who consume enough calories from whole foods d.a and b e.b and c   72.A woman who is on a low-carbohydrate diet for weight loss may have difficulty maintaining an adequate level […]

  1.2   The Economic Way of Thinking   1) Rational choice A) is a choice that uses the available resources to best achieve the objective of the person making the choice. B) is always efficient. C) is what you must give up to get what you want. D) is made by comparing different incentives. E) provides the answer to only the “how” question.   2) […]

    21) In the capital and financial account, the largest category of international transactions is A) net interest. B) foreign investment in the United States. C) net transfers. D) exports and imports. E) statistical discrepancy. 22) When a German company purchases a U.S. company for $20 million, in the balance of payments the value of that transaction is recorded in the A) purchase account. […]

Multiple Choice – Section 00: Introduction 1.YouuseU.S.currencytopaytheownerofarestaurantforadeliciousmeal.Thecurrency a.hasnointrinsicvalue.Theexchangeisanexampleofbarter. b.hasnointrinsicvalue.Theexchangeisnotanexampleofbarter. c.hasintrinsicvalue.Theexchangeisnotanexampleofbarter. d.hasintrinsicvalue.Theexchangeisnotanexampleofbarter. 2.Whichofthefollowingisanexampleofbarter? a.Aparentgivesateenagera$10billinexchangeforherbabysittingservices. b.Ahomeownergivesanexterminatoracheckfor$50inexchangeforexterminationservices. c.Abarbergivesaplumberahaircutinexchangefortheplumberfixingthebarber’sleakyfaucet. d.Alloftheaboveareexamplesofbarter. 3.Adoublecoincidenceofwants a.isrequiredwhenthereisnoiteminaneconomythatiswidelyacceptedinexchangeforgoodsandservices. b.isrequiredinaneconomythatreliesonbarter. c.isahindrancetotheallocationofresourceswhenitisrequiredfortrade. d.Alloftheabovearecorrect. 4.Considerthefollowingtraderswhomeet.   Bill hasaneggplant wantsaheadofcabbage Tim hasaheadoflettuce wantsacucumber Mike hasatomato wantsaneggplant Amy hasacucumber wantsaheadoflettuce   Which,ifany,pairsoftradershasadoublecoincidenceofwants? a.BillwithMike b.TimewithAmy c.BillwithMike,andTimwith Amy d.BillwithTim,andMikewith Amy 5.Considerfoursurvivorsonanisland.   Ron hasacookingpot wantsamachete Alice hasamachete wantsafishingspear Raymond hasamachete wantsacookingpot Lee hasafishingspear wantsacoconut   Whichofthefollowingpairsofsurvivorshasadouble-coincidenceofwants? a.RonwithAlice,andRonwithLee b.AlicewithLee c.RonwithRaymond d.Noneoftheabovearecorrect. 6.Considerfiveindividualswithdifferentoccupations.   […]

  71) The excess-capacity theorem predicts that A) when price-taking firms maximize their profits by setting price equal to marginal cost, each firm operates with some excess capacity. B) long-run equilibrium in a monopolistically competitive industry occurs with all firms producing at a lower output level than that which minimizes average total costs. C) profit-maximizing firms will always choose to operate with some degree of […]

  71) Refer to Figure 35-1. A rise in the exchange rate (moving up the vertical axis) indicates A) that fewer dollars are needed to purchase one euro. B) that more euros are required to purchase one Canadian dollar. C) an appreciation of the Canadian dollar. D) a depreciation of the Canadian dollar. E) no effect on the value of the currency. 72) Refer to […]

  81.RefertoTable23-7.From1975to1976, a.inflationwas25%andoutputdidnotgrow. b.inflationwas25%andoutputgrew. c.inflationwas50%andoutputdidnotgrow. d.inflationwas50%andoutputgrew. 82.RefertoTable23-7.From1976to1977, a.inflationwas33.3%andoutputgrewatarateof20%. b.inflationwas33.3%andoutputgrewatarateof60%. c.inflationwas50%andoutputgrewatarateof20%. d.inflationwas50%andoutputgrewatarateof60%. Table23-8   Acountryproducesonlymeatandpotatoesinthequantitiesandpriceslistedbelow.Use2011asthebaseyear.   Year Price of Potatoes Quantity of Potatoes Price of Meat Quantity of Meat 2011 $2.00 10 $20 6 2012 $2.50 15 $22 7 2013 $3.50 20 $25 8   83.RefertoTable23-8.In2012,nominalGDPis a.$191.50,andrealGDPis$170. b.$157,andrealGDPis$170. c.$191.50,andrealGDPis$157. d.$170,andrealGDPis$227.50. 84.RefertoTable23-8.In2012,GDPdeflatoris a.122. b.134. c.92. d.113. Table23-9   Acountryproducesonlyicecreamandpie.Quantitiesandpricesofthesegoodsforthelastseveralyearsareshownbelow.Thebaseyearis2008.   Prices and Quantities Year Price of Ice […]

  61) When cost-push inflation starts, real GDP ________ and the unemployment rate ________. A) decreases; falls B) does not change; falls C) decreases; rises D) does not change; does not change E) increases; falls   62) When cost-push inflation starts, real GDP ________ and the price level ________. A) decreases; falls B) does not change; falls C) decreases; rises D) does not change; does […]

    60.              The change in total cost, if one alternative is implemented instead of another, is referred to as: A)incremental cost B)opportunity cost C)changing cost D)joint cost   61.              The rule for making sound economic decisions is that one should choose the alternative with the A)highest contribution margin B)lowest opportunity cost C)lowest sunk costs D)highest revenue   62.   When deciding to purchase new equipment […]