Which statement about the loanable funds market

Which statement about the loanable funds market is NOT correct?

Question 1 options:

a.The market suppliers are the savers and the buyers are the borrowers.

b.The price of loanable funds is the real interest rate.

c. Loanable funds are provided by savers to borrowers to spend on investment goods and services.

d.The loanable funds theory describes changes in short-term interest rates.

All of these influence supply except

Question 2 options:

a. prices of inputs

b. expected future prices

c. extent of competition in the market

d. price of the product.

Which statement does NOT correctly describe bonds?

Question 3 options:

a. Municipal bonds are used by state and local governments to finance school, roads and other public projects.

b.A one-year T-bill with a face value of $1000 and offered at $900 yields an interest rate of 11.1 percent.

c.U.S. treasury notes have maturities that range from 2 to 10 years whereas U.S. treasury bonds have maturities of 30 years.

d.Corporate bonds are usually issued at a lower rate of interest than government bonds because of their lower risk of default.

CPI is measured as the change in

Question 4 options:

a. The prices of the basket of consumer goods and services, excluding volatile food and energy prices.

b. The prices of goods and services purchased by producers and consumers.

c. The prices of consumer goods and services that are produced in the country.

d. The prices of the entire basket of consumers' purchases of goods and services.

Which is an example of the subsitution effect on demand?

Question 5 options:

a. the price of coffee rises, so you buy less coffee.

b. The price of coffee rises, so you buy more coffee.

c. the price of coffee rises, so you buy more tea and less coffee.

d. the price of coffee rises, but you buy the same amount of coffee.

An expansionary fiscal policy is when

Question 6 options:

a. the government lowers spending and raises taxes.

b. the Federal Reserve buys bonds on the open market.

c. the government increases spending and lowers taxes.

d. The Federal Reserve sells bonds on the open market.

Demand-pull inflation is

Question 7 options:

a.caused by a shock to supply, such as a crop failure.

b.caused by price manipulation by cartels.

c. caused by an expansionary monetary policy.

d.caused by high unemployment.

Which of the following is explained by the price elasticity of demand?

Question 8 options:

a. The effect of price changes on supply.

b. The effect of price changes on the quantity supplied.

c. The effect of price changes on demand.

d. The effect of price changes on the quantity demanded.

Which situation describes the increasing returns stage of the production function?

Question 9 options:

a.Hiring one more tailor results in three more suits produced per hour.

b. Hiring one more baker results in less than one oven available per baker.

c.Buying one more office computer causes there to be more computers than workers.

d.Extending the workday results in more tired and less productive workers.

Which of the following describes the short-run time production period?

Question 10 options:

Firms can vary only one of the inputs in the production process.

Firms can vary all inputs into the production process.

Firms cannot vary any of the inputs into the production process.

Firms can choose to go out of business.

Which of the following items would NOT be included in GDP?

Question 11 options:

a. The purchase of an historic Victorian home.

b. The export of US wheat.

c. The import of French wine.

d. Dividend income from a savings account.

An example of a contractionary monetary policy is

Question 12 options:

a. an decrease in the required reserve ratio.

b. a reduction in the interest banks receive on their reserves.

c. a decrease in the discount rate.

d. the Fed selling government securities in the open market.

Price discrimination is a situation where a producer

Question 13 options:

a.charges different prices in different markets.

b.charges the same price in different markets.

c.colludes with other companies on settingthe same price in all markets.

d. All of the above.

Which of the following describes the inflation-unemployment trade off?

Question 14 options:

a.Monetary policies that expand the money supply and lower interest rates will lower inflation and unemployment.

b.Monetary policies that expand the money supply and raise interest rates will lower inflation and unemployment.

c.Fiscal policies that increase government spending and lower unemployment will cause inflation.

d.Fiscal policies that increase government spending and lower unemployment will lower inflation.

Which of the following is an example of diminishing marginal utility?

Question 15 options:

a. You give up donuts on your diet.

b.You like one donut with your coffee, but not two.

c.You buy more donuts when the price of coffee rises.

d.You cut back on donuts after your pay cut.

As the interest rate falls, people hold ________ money instead of bonds because the opportunity cost of holding money has ________.

Question 16 options:

a.more; fallen.

b.more; risen.

c. less; fallen.

d less; risen.

The price of bonds and the interest rate are

Question 17 options:

a.not related.

b. positively related.

c. negatively related.

d. sometimes positively related and other times negatively related, depending on the bond payments.

Allocative efficiency means that

Question 18 options:

a. Consumers get the most goods at the lowest prices possible.

b. Production reaches consumers on time.

c. A small number of sellers coordinate products and prices.

d. Government lowers taxes.

Which of the following best describes the classical view of economics?

Question 19 options:

a. Because markets are inherently efficient, government intervention is rarely needed.

b. Because unemployment can be prolonged, government intervention is needed to stimulate job growth.

c. Because markets are inherently inefficient, government intervention is needed to smooth business cycles.

d. Because markets are inherently efficient, government intervention is needed only in the short run.

A price ceiling on items like apartment rents or meat is likely to lead to

Question 20 options:

a. Supply exceeding demand.

b. An increase in production.

c. Demand exceeding supply.

d. A decrease in demand.