Producer surplus is always the total area below the demand curve and above the supply curve.

Producer surplus is always the total area below the demand curve and above the supply curve.
 a. True
  b. False
  Indicate whether the statement is true or false

Question 2

In order to determine the velocity of money, we need to know:
 a. the money supply and the price level.
  b. nominal GDP and real GDP.
 c. the money supply and nominal GDP.
  d. the interest rate and nominal GDP.

Question 3

Other things equal, if the labor input grows faster than total output, total factor productivity falls.
 a. True
  b. False
  Indicate whether the statement is true or false

Question 4

Consumer surplus increases whenever the price of a good increases.
 a. True
  b. False
  Indicate whether the statement is true or false

Question 5

If nominal GDP is 954 billion and velocity is 9, then the money supply:
 a. is 106 billion.
 b. is 122 billion.
 c. is 98 billion.
 d. is greater than 8 trillion.

Question 6

In economics, the term technology refers to different ways of combining resources to produce output. In this sense, technological advances make possible the production of more output from a given amount of resources.
 a. True
  b. False
  Indicate whether the statement is true or false

Question 7

Consumer surplus increases whenever the price of a good decreases.
 a. True
  b. False
  Indicate whether the statement is true or false

Question 8

If the economy's real GDP is growing at 3 percent each year and velocity is constant, for the price level to increase:
 a. the money supply would have to grow at more than 3 percent per year.
  b. the money supply would have to grow at exactly 3 percent per year.
  c. the money supply would have to grow at less than 3 percent per year.
  d. the money supply would have to remain stable.

Question 9

Other things equal, advances in technology make resources more productive.
 a. True
  b. False
  Indicate whether the statement is true or false

Question 10

Consumer surplus equals the quantity supplied minus the quantity demanded.
 a. True
  b. False
  Indicate whether the statement is true or false

Question 11

If the money supply is held constant as both real and nominal GDP are rising.
 a. the velocity of money will rise.
  b. the velocity of money will fall.
  c. interest rates will rise.
 d. both (a) and (c)

Question 12

Abundance of natural resources is a necessary but not sufficient condition for economic growth.
 a. True
  b. False
  Indicate whether the statement is true or false