The short-run Phillips curve is downward sloping but the long-run is a vertical line.
a. True
b. False
Indicate whether the statement is true or false
Question 2When a country follows an inward-oriented strategy, it tends to produce:
a. only tertiary goods.
b. goods in which it has an absolute advantage.
c. only labor-intensive goods.
d. goods for which no export barriers exist.
e. goods that replace foreign manufactured products.
Question 3Which of the following is true about consumer surplus?
a. Consumer surplus is how much more consumers have to pay than they are willing to pay.
b. Consumer surplus is shown graphically as the area under the demand curve but above the supply curve.
c. An increase in the market price due to a decrease in supply will increase consumer surplus.
d. A decrease in market price due to an increase in supply will increase consumer surplus.
Question 4According to Milton Friedman, the short-run trade-off between unemployment and inflation comes from unanticipated inflation.
a. True
b. False
Indicate whether the statement is true or false
Question 5An inward-oriented strategy is designed to:
a. expand a country's export capacity.
b. lower the production of capital goods.
c. develop the domestic manufacturing sector.
d. promote the consumption of imported goods.
e. improve productivity in the domestic service sector.
Question 6Fred's demand schedule for movie DVDs is as follows: At 30, he would buy 1; at 25, he would buy two; at 15, he would buy 3; and at 10, he would buy 4 . If the price of movie DVDs equals 25, the consumer surplus Fred receives from purchasing movie DVDs would be:
a. zero.
b. 5.
c. 25.
d. 55.
Question 7Decreases in aggregate demand move the economy down the short run aggregate supply and up the Phillips Curve.
a. True
b. False
Indicate whether the statement is true or false
Question 8Which of the following is a primary product?
a. Tomato sauce
b. Chocolate bars
c. Salt
d. Breakfast cereal
e. A desk
Question 9Fred's demand schedule for movie DVDs is as follows: At 60, he would buy 1; at 50, he would buy two; at 30, he would buy 3; and at 20, he would buy 4 . If the price of movie DVDs equals 40, the consumer surplus Fred receives from purchasing movie DVDs would be:
a. 20.
b. 30.
c. 40.
d. 110.
Question 10An increase in aggregate demand would move the economy up and to the right along a short run aggregate supply curve and up and to the left along a Phillips Curve.
a. True
b. False
Indicate whether the statement is true or false
Question 11A product in the first stage of production is defined as a(n):
a. basic need.
b. investment.
c. environmental product.
d. primary product.
e. transitory product.
Question 12A price ceiling imposed below equilibrium price causes a deadweight loss for society because:
a. buyers benefit at the expense of sellers.
b. as a result of the ceiling, units of output are not produced despite the fact that the value to consumers exceeds the production cost.
c. sellers benefit at the expense of buyers.
d. the poor gain at the expense of the rich.
Question 13The Phillips Curve is steeper at higher rates of inflation and lower levels of unemployment.
a. True
b. False
Indicate whether the statement is true or false
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