Which of the following is not generally considered to be an ingredient for economic growth?
a. Investment in human capital.
b. Political instability.
c. High savings rate and investment in capital.
d. Growth in technology.
e. Investment in infrastructure.
QUESTION 2A short-run aggregate supply curve (SRAS) assumes:
a. the CPI is fixed.
b. each point on the SRAS is potential real GDP.
c. fixed or sticky nominal wages.
d. nominal wages vary directly with price changes.
QUESTION 3The required reserve ratio for a bank is set by:
a. Congress.
b. the bank itself.
c. the Treasury Department.
d. the banking system.
e. the Federal Reserve.
QUESTION 4The Four Tigers of East Asia are the newly industrialized countries of Taiwan, South Korea, Hong Kong, and:
a. Japan. b. Singapore.
c. the Philippines. d. Vietnam.
QUESTION 5One reason for the short-run aggregate supply curve (SRAS) is:
a. a fixed CPI market basket.
b. perfect knowledge of workers.
c. fixed-wage contracts.
d. the upward-sloping production function.
QUESTION 6Assume that Paris First National Bank is a thriving bank with deposits of 20 million. If the required reserve ratio is 20 percent and the bank is fully loaned out, the bank will keep what amount of required reserves?
a. 2 million.
b. 4 million.
c. 10 million.
d. 16 million.
e. 20 million.
QUESTION 7Which of the following is correct?
a. Economic development is more quantitative than economic growth.
b. A country cannot achieve economic growth with a limited base of natural resources.
c. Infrastructure is capital provided by the private sector.
d. All of the above are true.
e. All of the above are false.
QUESTION 8An aggregate supply curve with a positive slope is associated with an economy in which:
a. input prices and final goods prices always change by the same amount.
b. firms expect output prices to be unaffected by changes in input prices.
c. nominal wages and salaries do not change much in the short run.
d. firms expect consumer demand to be unaffected by changes in prices of final goods.
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