Question # 1

Japan's low interest rates in the mid 80's were due to.

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High rates of domestic savings.

A decrease in Japan's exports

Increases in the U.S. deficit

High rates of domestic spending in Japan

In land intensive method which mean production is used comparativelymore

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Labour

Land

Capital

Organization

Profit is measured by

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Revenue - Fixed costs

Fixed cost + revenue

Revenue - sales

Revenues - total costs

If the "Regulated -market" price is below the equilibrium price.

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The quantity demanded will be greater than quantity supplied

Demand will be les than supply

Quantity demanded will be less than quantity supplied

Quantity demanded will equal quantity supplied

If product an inferior good.

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Demand is inversely related to income

Demand is inversely related to price

Demand is directly related to price

Demand is inversely related to the price of substitutes

Lower interest rates are likely to.

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Decrease consumption

Increase cost of borrowing

Encourage saving

Increase spending

The hypothesis that people know the true model of the economy and that they use this model and al available information to form their expectations of the future is the

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Relational expectations hypothesis.

Active expectations hypothesis

Static expectations hypothesis

Adeptive expectations hypothesis

Firms in perfect competition face a

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Perfectly elastic demand curve

Perfectly inelastic demand curve

Perfectly elastic supply curve

Perfectly inelastic supply curve

A supply curve that starts at the origin has

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A price elasticity of supply greater than one

A price elasticity of supply equal to one

A price elasticity of supply less than one

A positive price elasticity of supply

Which of the following is necessary for a natural monopoly.

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Economies of scale

A high proportion of the total cost is the cost of capital goods

The market is very small

All of the above

In a Boom

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Surpluses are likely to occur

Prices are likely to fall

supply will increase immediately to match demand

Shortages may occur

Less Developed countries lend to have

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A high average age

A slow population growth rate

High life expectancy

A low literacy rate

Capital, as economists use the term.

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Is the money the firm spends to hire resources

Is money the firm raises from selling stock

Refers to the process by which resources are transformed into useful forms

Refers to things that have already been produced that are in turn used to produce other goods and services.

In a recession a government.

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Is likely to want to increase demand in the economy

Is likely to want to decrease demand in the economy

Is likely to want to stabilize demand in the economy

Is likely to want to increase supply in the economy

In the long run in perfect competitiion

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the price equals the total revenue

Firm are allocatively inefficient

Firms are productively efficient

the price equals total cost

Which of the following would decrease aggregate demand.

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Increased consumption

Increasing export revenue

Increased taxation revenue

Increased investment

Friend man's theory of consumption focuses on

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Past income

Current income

Disposable income

Permanent income

If injection are less than with drawls at the full employment level of national income there is.

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an inflationary gap

Equilibrium

A deflationary gap

Hyperinflation

Human wants are

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Always fixed

Limited

Unlimited

Likely to decrease over time

As the MPS increases, the multiplier will

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Increase

Either increase or decrease depending on the size of the change in investment

Remain constant

Decrease

With a positive externality

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There is under consumption in the free market

There is over consumption in the free market

The government may tax to decrease production

Society could be made off if less was produced

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