Globalization can be defined as:
a. the attitude or policy of placing the interests of the entire world above those of individual nations.
b. viewing the entire world as a proper sphere for one nation to project political influence.
c. a period in history that has witnessed a dramatic change in world political thought and the balance of power.
d. an increased cross-border flow of trade in goods, services, and financial assets, along with an increased international mobility of technology, information, and individuals.
e. a social movement that supports global cooperation and interaction, but which opposes the negative effects of economic development across nations.
Question 2Which of the following will most likely generate positive externalities?
a. a hot dog vendor
b. public education
c. an automobile
d. a steel mill
Question 3When the actual inflation rate exceeds the expected inflation rate due to changes in aggregate demand:
a. Unemployment is below the natural rate of unemployment.
b. Unemployment is above the natural rate of unemployment.
c. Unemployment equals the natural rate of unemployment.
d. Unemployment could be above, equal to, or below the natural rate of unemployment.
Question 4No government that receives foreign aid sells products to its people.
a. True
b. False
Indicate whether the statement is true or false
Question 5Negative externalities are costs incurred by: i. buyers ii. sellers iii. someone other than buyers or sellers
a. (i) only
b. (ii) only
c. (iii) only
d. both (i) and (ii)
Question 6The short-run Phillips curve always intersects the long-run Phillips curve at:
a. Zero inflation.
b. At an accelerating inflation rate.
c. The expected inflation rate.
d. The same rate over time.
Question 7Foreign aid that flows from one country to another is called multilateral aid.
a. True
b. False
Indicate whether the statement is true or false
Question 8Costs that accrue to the total population are called ____ costs. Costs incurred by the producer or consumer who makes the decision are called ____ costs.
a. negative; positive
b. social; private
c. private; social
d. positive; negative
Question 9Lower than expected inflation rate:
a. shifts short-run Phillips curve to the right.
b. shifts short-run Phillips curve to the left.
c. shifts both short-run and long-run Phillips curve to the right.
d. shifts both short-run and long-run Phillips curve to the left.
Question 10Foreign aid usually consists of funds loaned at high interest rates.
a. True
b. False
Indicate whether the statement is true or false
Question 11An externality occurs when:
a. people other than those making the demand and supply decisions share the benefits or the costs of an activity.
b. only the people making the demand and supply decisions share the benefits or the costs of an activity.
c. private costs of production equal the full social costs associated with production of a good.
d. private costs of production are ignored.
Question 12Higher than expected inflation rate:
a. shifts short-run Phillips curve to the right.
b. shifts long-run Phillips curve to the right.
c. shifts both short-run and long-run Phillips curve to the right.
d. shifts short-run Phillips curve to the left.
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