Macroeconomics 1st Brief Edition Campbell Mcconnell, Stanley Brue, Sean Flynn - Solutions

Discover the ultimate resource for mastering "Macroeconomics 1st Brief Edition" by Campbell McConnell, Stanley Brue, and Sean Flynn. Our comprehensive platform offers online solutions, featuring an answers key and a detailed solution manual. Access solutions in PDF format, covering solved problems with step-by-step answers. Whether you need questions and answers, a test bank, or chapter solutions, our instructor manual and textbook resources have you covered. Explore the convenience of free download options, making it easier than ever to excel in your studies with this essential academic tool.

Education and training that improve the skill of the labor force are represented on the production possibilities curve by a(an)a. movement along the curve.b. inward shift of the curve.c. outward shift of the curve.d. movement toward the curve from an exterior point.
Along a production possibilities curve, an increase in the production of one good can be accomplished only bya. decreasing the production of another good.b. increasing the production of another good.c. holding constant the production of another good.d. producing at a point on a corner of the curve.
Using a production possibilities curve, unemployment is represented by a point locateda. near the middle of the curve.b. at the top corner of the curve.c. at the bottom corner of the curve.d. outside the curve.e. inside the curve.
Any point inside the production possibilities curve is a(an)a. efficient point.b. unfeasible point.c. inefficient point.d. maximum output combination.
On a production possibilities curve, a change from economic inefficiency to economic efficiency is obtained bya. movement along the curve.b. movement from a point outside the curve to a point on the curve.c. movement from a point inside the curve to a point on the curve.d. a change in the slope of
If a farmer adds 1 pound of fertilizer per acre, the value of the resulting crops rises from $80 to$100 per acre. According to marginal analysis, the farmer should add fertilizer if it costs less thana. $12.50 per pound.b. $20 per pound.c. $80 per pound.d. $100 per pound.
On a production possibilities curve, the opportunity cost of good X in terms of good Y is represented bya. the distance to the curve from the vertical axis.b. the distance to the curve from the horizontal axis.c. the movement along the curve.d. all of the above.
Opportunity cost is thea. purchase price of a good or service.b. value of leisure time plus out-of-pocket costs.c. best option given up as a result of choosing an alternative.d. undesirable sacrifice required to purchase a good.
A student who has one evening to prepare for two exams on the following day has the following two alternatives:Possibility Score in Economics Score in Accounting A 95 80 B 80 90 The opportunity cost of receiving a 90, rather than an 80, on the accounting exam is represented by how many points on
Which of the following decisions must be made by all economies?a. How much to produce? When to produce?How much does it cost?b. What is the price? Who will produce it? Who will consume it?c. What to produce? How to produce it? For whom to produce?d. None of the above.
The present choice between investing in capital goods and producing consumer goods now affects the ability of an economy to produce in the future.Explain.
Draw a production possibilities curve for a hypothetical economy producing capital goods and consumer goods. Suppose a major technological breakthrough occurs in the capital goods industry and the new technology is widely adopted only in this industry. Draw the new production possibilities curve.
Suppose, unfortunately, your mathematics and economics professors have decided to give tests 2 days from now and you can spend a total of only 12 hours studying for both exams. After some thought, you conclude that dividing your study time equally between each subject will give you an expected
Interpret the phrases “There is no such thing as a free lunch” and “A free lunch is possible” in terms of the production possibilities curve.
Why does a production possibilities curve have a bowed-out shape?
The following table shows the production possibilities for pies and flower boxes. Fill in the opportunity cost (pies forgone) of producing the first through the fifth flower box.Combination Pies Flower Boxes Opportunity Cost A 30 0 ___________ B 26 1 ___________ C 21 2 ___________ D 15 3
The following is a set of hypothetical production possibilities for a nation.Combination Automobiles(thousands)Beef(thousands of tons)A 0 10 B 2 9 C 4 7 D 6 4 E 8 0a. Plot these production possibilities data. What is the opportunity cost of the first 2,000 automobiles produced? Between which points
Attending college is expensive, time-consuming, and it requires effort. So why do people decide to attend college?
Which of the following decisions has the greater opportunity cost? Why?a. A decision to use an undeveloped lot in Tokyo’s financial district for an apartment building.b. A decision to use a square mile in the desert for a gas station.
Explain verbally the statement “There is no such thing as a free lunch” in relation to scarce resources.
Suppose a retailer promotes its store by advertising a drawing for a “free car.” Is this car free because the winner pays zero for it?
Explain why scarcity forces individuals and society to incur opportunity costs. Give specific examples.
Which of the following pairs is the most likely to exhibit an inverse relationship?a. The amount of time you study and your grade point averageb. People’s annual income and their expenditure on personal computersc. Baseball players’ salaries and their batting averagesd. The price of a concert
In Exhibit A-8, the slope of straight line AB isa. 3.b. 1.c. −1.d. −5.
As shown in Exhibit A-8, the slope of straight line ABa. decreases with increases in X.b. increases with increases in X.c. increases with decreases in X.d. remains constant with changes in X.
Straight line AB in Exhibit A-8 shows thata. increasing the value of X reduces the value of Y.b. decreasing the value of X increases the value of Y.c. there is an inverse relationship between X and Y.d. all of the above are true.
In Exhibit A-7, the slope of straight line CD isa. positive.b. zero.c. negative.d. variable.
In Exhibit A-7, the slope of straight line CD isa. 3.b. 1.c. −1.d. 1/2.
Straight line CD in Exhibit A-7 shows thata. increasing the value of X will increase the value of Y.b. decreasing the value of X will decrease the value of Y.c. there is a direct relationship between X and Y.d. all of the above are true.
Assume a research firm collects survey sales data that reveal the relationship between the possible selling prices of hamburgers and the quantity of hamburgers consumers would purchase per year at alternative prices. The report states that if the price of a hamburger is $4, 20,000 will be bought.
Draw a graph without specific data for the expected relationship between the following variablesa. The probability of living and ageb. Annual income and years of educationc. Inches of snow and sales of bathing suitsd. The number of football games won and the athletic budget In each case, state
Computer programs, or software, are an example ofa. land.b. labor.c. capital.d. none of the above.
Which of the following is a statement of positive economics?a. An unemployment rate greater than 8 percent is good because prices will fall.b. An unemployment rate of 7 percent is a serious problem.c. If the overall unemployment rate is 7 percent, unemployment rates among AfricanAmericans will
Which of the following is a statement of positive economics?a. The income tax system collects a lower percentage of the incomes of the poorb. A reduction in tax rates of the rich makes the tax system more fairc. Tax rates ought to be raised to finance health cared. All of the above are primarily
An economist notices that sunspot activity is high just prior to recessions and concludes that sunspots cause recessions. The economist hasa. confused association and causation.b. misunderstood the ceteris paribus assumption.c. used normative economics to answer a positive question.d. built an
A review of the performance of the U.S. economy during the 1990s is primarily the concern ofa. macroeconomics.b. microeconomics.c. both macroeconomics and microeconomics.d. neither macroeconomics nor microeconomi?
Microeconomics approaches the study of economics from the viewpoint ofa. individual or specific markets.b. the operation of the Federal Reserve.c. economywide effects.d. the national economy.
Which of the following is not a resource?a. Landb. Laborc. Moneyd. Capital
Which of the following would eliminate scarcity as an economic problem?a. Moderation of people’s competitive instinctsb. Discovery of sufficiently large new energy reservesc. Resumption of steady productivity growthd. None of the above because scarcity cannot be eliminated
Scarcity existsa. when people consume beyond their needs.b. only in rich nations.c. in all countries of the world.d. only in poor nations.
“The government should collect higher taxes from the rich and use the additional revenues to provide greater benefits to the poor.” This statement is an illustration of aa. testable statement.b. basic principle of economics.c. statement of positive economics.d. statement of normative economics.
Which of the following is an example of a proposition from positive economics?a. If John Kerry had been elected president, taxpayers would have been treated more fairly than under George W. Bush.b. The average rate of inflation was higher during George W. Bush’s presidency than during Bill
A model is defined as aa. value judgment of the relationship between variables.b. presentation of all relevant aspects of realworld events.c. simplified description of reality used to understand the way variables are related.d. data set adjusted for irrational actions of people.
Computer software programs are an example ofa. capital.b. labor.c. a natural resource.d. none of the above.
How exchange rates are determined in currency markets.
How to apply the long-run AD-AS model to inflation, recessions, and economic growth.
How the Fed has used monetary policy in recent years to promote macroeconomic stability
How the equilibrium interest rate is determined in the market for money.
How banks create money in a “fractional reserve”banking system.
Why there is a long-run fiscal imbalance in the Social Security system.
About the size, composition, and consequences of the U.S. public debt.
How the standardized budget reveals the status of U.S. fiscal policy.
How the AD-AS model explains periods of demand-pull inflation, cost-push inflation, and recession.
How AD and AS determine an economy’s equilibrium price level and level of real GDP.
How economists distinguish between nominal GDP and real GDP.
How gross domestic product (GDP) is defined and measured.
How public goods are distinguished from private goods.
What government-set prices are and how they can cause product surpluses and shortages.
How changes in supply and demand affect equilibrium prices and quantities.
How supply and demand together determine market equilibrium.
What supply is and what affects it.
What demand is and what affects it.
How the market system adjusts to change and promotes progress.
How the market system answers four fundamental questions.
What is the WTO, and how does it affect international trade? How many nations belong to the WTO? (Update the number given in this book at www.wto.org .) Is the Doha Round (or Doha Agenda) still in progress, or has it been concluded with an agreement (again, use the WTO Website)? If the former, when
Explain: “Free-trade zones such as the EU and NAFTA lead a double life: They can promote free trade among members, but they pose serious trade obstacles for nonmembers.” Do you think the net effects of trade blocs are good or bad for world trade? Why? How do the efforts of the WTO relate to
Speculate as to why some U.S. firms strongly support trade liberalization while other U.S. firms favor protectionism.Speculate as to why some U.S. labor unions strongly support trade liberalization while other U.S. labor unions strongly oppose it. LO4
What measures do governments take to promote exports and restrict imports? Who benefits and who loses from protectionist policies? What is the net outcome for society?LO4
If the European euro were to depreciate relative to the U.S.dollar in the foreign exchange market, would it be easier or harder for the French to sell their wine in the United States? Suppose you were planning a trip to Paris. How would depreciation of the euro change the dollar cost of your trip?
Explain why you agree or disagree with the following statements: LO3a. A country that grows faster than its major trading partners can expect the international value of its currency to depreciate.b. A nation whose interest rate is rising more rapidly than interest rates in other nations can expect
Explain why the U.S. demand for Mexican pesos is downward-sloping and the supply of pesos to Americans is upward-sloping. Indicate whether each of the following would cause the Mexican peso to appreciate or depreciate:LO3a. The United States unilaterally reduces tariffs on Mexican products.b.
What is offshoring of white-collar service jobs, and how does it relate to international trade? Why has it recently increased? Why do you think more than half of all offshored jobs have gone to India? Give an example (other than that in the textbook) of how offshoring can eliminate some U.S.jobs
What effect do rising costs (rather than constant costs) have on the extent of specialization and trade? Explain. LO2
The following are production possibilities tables for South Korea and the United States. Assume that before specialization and trade the optimal product mix for South Korea is alternative B and for the United States is alternative U.LO2 South Korea Production Possibilities Product A B C D E F LCD
Below are hypothetical production possibilities tables for New Zealand and Spain. Each country can produce apples and plums. LO2 New Zealand’s Production Possibilities Table(Millions of Bushels)Production Alternatives Product A B C D Apples 0 20 40 60 Plums 15 10 5 0 Spain’s Production
Quantitatively, how important is international trade to the United States relative to its importance to other nations?What country is the United States’ most important trading partner, quantitatively? With what country does the United States have the largest current trade deficit? LO1
The capital gains tax is the tax on the income realized when someone sells an asset for more than its purchase price. Why might tax revenues from this tax source actually decline for awhile if the tax rate on capital gains increases? LO5
Suppose that the U.S. inflation rate and unemployment rate both increased relative to previous years for several years in a row. What might explain this, and what could you conclude about the location of the short-run Phillips Curve?LO3
Between 1990 and 2007, the GDP price level rose by about 47 percent while real GDP increased by about 63 percent.Use the long-run aggregate demand–aggregate supply model to illustrate these outcomes graphically. LO2
Use graphical analysis to show how each of the following would affect the economy first in the short run and then in the long run. Assume that the United States is initially operating at its full-employment level of output, that prices and wages are eventually flexible both upward and downward, and
Suppose the full-employment level of real output ( Q) for a hypothetical economy is $250 and the price level ( P) initially is 100.Use the short-run aggregate supply schedules below to answer the questions that follow: LO1a. What will be the level of real output in the short run if the price level
Which of the following statements are true? Which are false? Explain why the false statements are untrue. LO1 economics™a. Short-run aggregate supply curves reflect an inverse relationship between the price level and the level of real output.b. The long-run aggregate supply curve assumes that
What actions did the Fed take in the second half of 2007 and early 2008? What motivated these actions? LO5
Distinguish between the Federal funds rate and the prime interest rate. Which of these two rates does the Fed explicitly target in undertaking its monetary policy? In 2004 and 2005 the Fed used open-market operations to significantly increase the Federal funds rate. What was the logic of those
What do economists mean when they say that monetary policy can exhibit cyclical asymmetry? Why is this possibility significant to policymakers? LO4
Why is monetary policy easier to undertake than fiscal policy in a highly divided national political environment? LO4
Suppose that you are a member of the Board of Governors of the Federal Reserve System. The economy is experiencing a sharp and prolonged inflationary trend. What changes in (a) the reserve ratio, (b) the discount rate, (c) open-market operations, and (d) the amount of reserves offered at the term
Why do changes in bank reserves resulting from open-market operations by the Fed produce multiple changes in checkable deposits (and therefore money) in the economy? LO3
What is the impact of each of the following transactions on commercial bank reserves? LO2a. The New York Federal Reserve Bank purchases government securities from private businesses and consumers.b. Commercial banks borrow from Federal Reserve Banks at the discount rate.c. The Fed reduces the
What is the basic objective of monetary policy? State the cause-effect chain through which monetary policy is made effective. What are the major strengths of monetary policy?LO2
Assume that the following data characterize a hypothetical economy: money supply ⫽ $200 billion; quantity of money demanded for transactions ⫽ $150 billion; quantity of money demanded as an asset ⫽ $10 billion at 12 percent interest, increasing by $10 billion for each 2-percentage-point fall
What is the basic determinant of (a) the strength of the transactions demand for money (the location of the transactions demand for money curve) and (b) the amount of money demanded for assets, given a particular asset demand for money curve? How is the equilibrium interest rate in the market for
Suppose the simplified consolidated balance sheet shown below is for the entire commercial banking system. All figures are in billions. The reserve ratio is 25 percent. LO5a. What amount of excess reserves does the commercial banking system have? What is the maximum amount the banking system might
Suppose that Continental Bank has the simplified balance sheet shown below and that the reserve ratio is 20 percent:LO5a. What is the maximum amount of new loans that this bank can make? Show in column 1 how the bank’s balance sheet will appear after the bank has lent this additional amount.b. By
Suppose the National Bank of Commerce has excess reserves of $8000 and outstanding checkable deposits of$150,000. If the reserve ratio is 20 percent, what is the size of the bank’s actual reserves? LO5
Explain why a single commercial bank can safely lend only an amount equal to its excess reserves but the commercial banking system as a whole can lend by a multiple of its excess reserves. What is the monetary multiplier, and how does it relate to the reserve ratio? LO5
“Whenever currency is deposited in a commercial bank, cash goes out of circulation and, as a result, the M 1 supply of money is reduced.” Do you agree? Explain why or why not.LO5
Why does the Federal Reserve require that commercial banks have reserves? What are excess reserves? How do you calculate the amount of excess reserves held by a bank?What is the significance of excess reserves? LO5
Why must a balance sheet always balance? What are the major assets and claims on a commercial bank’s balance sheet?LO5
What is meant when economists say that the Federal Reserve Banks are central banks, quasi-public banks, and bankers’ banks? What are the seven basic functions of the Federal Reserve System? LO4

Showing 4200 - 4300 of 5072

First
36
37
38
39
40
41
42
43
44
45
46
47
48
49
50
Last

Macroeconomics 1st Brief Edition Campbell Mcconnell, Stanley Brue, Sean Flynn - Solutions

Step by Step Answers