Which of the following statements is a positive economic statement?
A) The number of families living in poverty in the United States is too high.
B) One in every five children in the United States is living in poverty.
C) Government programs to help the poor are just making problems worse.
D) Increases in poverty rates signify a deterioration of the U.S. economy.
Ques. 2Technology
A) is constantly changing at every point along a production possibilities curve.
B) is the recipe for combining land, labor, physical capital, and entrepreneurship to produce a good.
C) does not have an effect on the amount of a good a society can produce with its given resources.
D) only changes if resources change.
Ques. 3All of the following are reasons for an oligopoly to occur EXCEPT
A) economies to scale.
B) barriers to entry.
C) independence among firms.
D) merger.
Ques. 4One of the long-run effects of higher government budget deficits is
A) a redistribution of real Gross Domestic Product (GDP) away from government-provided goods and toward more privately provided goods.
B) an increase in the government's share of the nation's economic activity.
C) growth in the economy's private sector at the same time the government sector shrinks.
D) a fall in the equilibrium price level.
Ques. 5The Keynesian short-run aggregate supply (SRAS) curve is
A) upward sloping.
B) vertical.
C) horizontal.
D) downward sloping.
Ques. 6As an economy moves from point to point along its production possibilities curve, which one of the following variables changes?
A) the total amount of resources employed
B) the level of technology
C) the time frame under consideration
D) the amount of each good or service produced
Ques. 7In a monopolistically competitive market if the additional revenue generated from advertising equals the additional cost of advertising, the firm should
A) advertise more to increase sales.
B) advertise more to lower marginal costs.
C) maintain its current amount of advertising.
D) advertise less to decrease costs.
Ques. 8Unemployment that is caused by business recessions is called
A) frictional unemployment.
B) cyclical unemployment.
C) seasonal unemployment.
D) structural unemployment.
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