If a certain combination of goods lies outside the production possibilities curve of an economy, which of the following is true? Resources are not being used efficiently to achieve that combination of goods or services The economy is experiencing a surplus of resources The combination is attainable with current resources The economy is operating at full efficiency

Resources are not being used efficiently to achieve that combination of goods or services

Which of the following groups would likely gain from unanticipated inflation? Individuals with fixed income investments Lenders with fixed interest loans Savers with fixed interest savings accounts Individuals who have borrowed money at fixed interest rates

Individuals who have borrowed money at fixed interest rates

With a constant money supply, if the demand for money increases, the equilibrium interest rate and quantity of money will change in which of the following ways? Interest Rate: Increase, Quantity of Money: Not Change Interest Rate: Decrease, Quantity of Money: Decrease Interest Rate: Increase, Quantity of Money: Increase Interest Rate: Decrease, Quantity of Money: Not Change

Interest Rate: Increase, Quantity of Money: Not Change

According to the graph above, an increase in aggregate supply will most likely cause income and unemployment to change in which of the following ways? Income: Decrease, Employment: Decrease Income: Increase, Employment: Decrease Income: Increase, Employment: Increase Income: Decrease, Employment: Increase

Income: Increase, Employment: Increase

If the exchange rate between the United States ($) and the British pound (£) changed from $2 per £1 to $3 per £1, and domestic prices in both countries stayed the same, then the United States dollar would Appreciate, making US exports cheaper Depreciate, making the US imports from Britain more expensive Depreciate, making US exports more expensive Remain stable, with no effect on trade

Depreciate, making the US imports from Britain more expensive

If an economy is operating with significant unemployment, an increase in which of the following will most likely cause unemployment to increase and the interest rate to decrease? Increase in interest rates Increase in taxes Decrease in government spending Purchases of govt. bonds by the central bank

Purchases of govt. bonds by the central bank

The concept of opportunity cost would no longer be relevant if The supply of all resources were unlimited Resources were scarce All goods were free Demand for goods was infinite

The supply of all resources were unlimited

Which of the following will cause aggregate supply to increase in Country X? An increase in corporate taxes A rise in labor costs A decrease in technological innovation The discovery of low-cost alternative sources of energy

The discovery of low-cost alternative sources of energy

The graph above shows the production possibilities curve for Factory X and Factory Y. If Factory X uses the same amount of resources to produce skateboards and bikes as Factory Y uses, which of the following is true? Factory Y has a comparative advantage in producing skateboards. Factory X has a comparative advantage in producing skateboards. Both factories have the same opportunity cost for producing skateboards. Neither factory has a comparative advantage in producing skateboards.

Factory X has a comparative advantage in producing skateboards.

An increase in the price of oil, an important input to production, will result in which of the following in the short run? A decrease in short-run aggregate supply An increase in aggregate demand An increase in short-run aggregate supply A decrease in aggregate demand

A decrease in short-run aggregate supply

An economy is currently operating at the full-employment level of output. Which of the following would result in a recessionary gap in the short run? An increase in consumer confidence An increase in the costs of production A decrease in interest rates A decrease in government spending

An increase in the costs of production

Thailand and Malaysia are trading partners. If the price level in Thailand decreases relative to the price level in Malaysia, what will happen to Thailand's exports to Malaysia and Thailand's aggregate demand? Exports will increase; Aggregate demand will decrease Exports will decrease; Aggregate demand will increase Exports will increase; Aggregate demand will increase Exports will decrease; Aggregate demand will decrease

Exports will increase; Aggregate demand will increase

Increases in human capital can be achieved by which of the following? Reducing the number of work hours Improving the quality of job-training programs Increasing the retirement age Decreasing educational funding

Improving the quality of job-training programs

What does International Financial Management involve in an international business environment? Only currency exchange Domestic financial management Different currencies, political situations, imperfect markets, diversified opportunities Local market analysis

Different currencies, political situations, imperfect markets, diversified opportunities

What does the International Monetary System encompass? Local trade agreements International payments, capital movements, exchange rates Domestic banking systems Only currency exchange

International payments, capital movements, exchange rates

What are the three major dimensions that set international finance apart from domestic finance? Trade agreements, tariffs, quotas Foreign exchange and political risks, market imperfections, expanded opportunity set Currency exchange, local laws, domestic policies Interest rates, inflation, unemployment

Foreign exchange and political risks, market imperfections, expanded opportunity set

What does globalization describe in terms of world cultures and economies? National self-sufficiency Isolation of economies Increasing connectedness and interdependence Local trade only

Increasing connectedness and interdependence

How does globalization manifest as a social, cultural, political, and legal phenomenon? Isolation of cultures Greater interaction, exchange of ideas, altered international law Local customs and traditions National laws only

Greater interaction, exchange of ideas, altered international law

What is the Balance of Payments? A summary of national debts A record of domestic transactions only A list of government expenditures A systematic record of all economic transactions between residents of a country and foreign countries

A systematic record of all economic transactions between residents of a country and foreign countries

What did Milton Friedman mean by saying that 'inflation is always and everywhere a monetary phenomenon'? Inflation is caused by an increase in the money supply relative to the quantity of goods and services. Inflation is caused by government policies unrelated to money supply. Inflation is caused by an increase in demand for goods and services. Inflation is caused by a decrease in the supply of goods and services.

Inflation is caused by an increase in the money supply relative to the quantity of goods and services.

If a bank expects inflation to increase in the near future, how will it respond? It will stop issuing loans. It will start charging more interest on loans. It will decrease interest rates on loans. It will keep interest rates the same.

It will start charging more interest on loans.

Firms expect fewer sales and profits in the near future; this expectation would cause: the demand for loanable funds to decrease. the supply of loanable funds to decrease. the supply of loanable funds to increase. the demand for loanable funds to increase.

the demand for loanable funds to decrease.

The average price of a car in 1970 was $3,500. The consumer price index (CPI) was 38.8 in 1970 and 284 in 2022. The 2022 price of the 1970 car is computed as: $3,500 × (100 ÷ 38.8) = $9,020.62 $3,500 × (284 ÷ 38.8) = $25,618.56 $3,500 × (38.8 ÷ 284) = $478.17 $3,500 × (284 ÷ 100) = $9,940

$3,500 × (284 ÷ 38.8) = $25,618.56

Which event could be expected to shift a nation's demand for loanable funds, as shown in the accompanying graph? (shift left) a decrease in consumer confidence a decrease in productivity of capital an increase in productivity of capital an increase in consumer confidence

a decrease in productivity of capital

Economics

Flashcard >
Social Sciences >
Economics

Flashcard sets

View All

Macroeconomics

Understanding Economic Concepts and Policies through Multiple-Choice Questions

andrsonztdc

MCQ 100 Cards

Macroeconomics

Understanding Economic Concepts and Their Implications in Various Scenarios

georgepetenjk

MCQ 60 Cards

International Economics

International Financial Management: Global Monetary Systems and Balance of Payments

michael1tekrzp

MCQ 40 Cards

Textbooks

View All

Expert Q&A

View All

Macroeconomics

Understanding Economic Concepts and Policies through Multiple-Choice Questions

andrsonztdc

MCQ 100 Cards

Macroeconomics

Understanding Economic Concepts and Their Implications in Various Scenarios

georgepetenjk

MCQ 60 Cards

International Economics

International Financial Management: Global Monetary Systems and Balance of Payments

michael1tekrzp

MCQ 40 Cards

Macroeconomics

Understanding Economic Concepts: Money, Inflation, and Loanable Funds

georgepetenjk

MCQ 80 Cards

Macroeconomics

Understanding Economic Concepts: Unemployment, Business Cycles, and Monetary Policies

michael1tekrzp

Fill in Blanks 28 Cards

Macroeconomics

Inflation and Monetary Policy: Economic Measurement, Effects, and Policy Responses

michael1tekrzp

Term / Definition 35 Cards

Macroeconomics

Key Economic Concepts and Principles: Multipliers, Policies, and Market Dynamics

charlotte1oxhi

MCQ 29 Cards

Macroeconomics

AP Final Macroeconomics Exam

charlotte1oxhi

Fill in Blanks 18 Cards

Macroeconomics

Macroeconomics Review

georgepetenjk

Fill in Blanks 81 Cards

International Economics

Understanding Trade Surplus, Deficit, & Balance of Payments

georgepetenjk

Fill in Blanks 17 Cards

Macroeconomics

ECON 1P92 Final Exam

charlotte1oxhi

Fill in Blanks 100 Cards

International Economics

International Finance and Currency Exchange: Global Monetary Systems and Institutions

andrsonztdc

MCQ 12 Cards

International Economics

International Trade & Finance

michael1tekrzp

MCQ 20 Cards

Political Economy

Comprehensive Overview of Political Economy

andrsonztdc

Fill in Blanks 10 Cards