1)
If the fed was concerned with inflation, it should?
a) buy bonds and raise the discount rate
b) sell bonds and raise the discount rate
c)sell bonds and lower the discount rate
2) If there are only two countries in the world and one has a
trade deficit, the other country must?
a) Also have a trade deficit
b) Have a trade surplus
c) Have trade restrictions in place
3) Goods and Services purchased from foreign sources are known
as?
a) Imports
b) Net exports
c) The trade deficit
4) Trade increase total world output because?
a) Specialization results in more effective use of
resources
b) specialization cause the production possibilities curve to
shift inward
C) It protects domestic producers
5) Fiscal and Monetary policies are used to shift the?
A) Aggregate demand curve
B) aggregate supply curve
C) production possibilities curve
6) To produce a combination of goods and services beyond the
current production possibilities curve, an economy must?
A) Raise the price of goods and services so that firms will
produce more.
B) find more resources or develop new technology
C) Experience population growth
7) When there is an increase in the reserve requirement
A) There is typically a resulting decrease in the money
supply
B) There is also an increase in the money multiplier
C) It generally reflects a desire by monetary authorities to
stimulate the economy
8) Discretionary fiscal policy refers to?
A) Monetary policy
B) Automatic changes in taxes and spending because of the
business cycle
C) changes in spending and revenue items because of new
legislation