Unformatted text preview: The higher is the level of taxes, the lower is consumption spending.
B) The higher is the level of taxes, the higher are wage demands.
C) A reduction in export taxes on petroleum would result in higher wages.
D) Tuition fees should be waived for low - income students.
E) A free- trade agreement between two countries will result in an increase in trade.
13) If 27 million people are employed and 3 million people are unemployed, what is the unemployment rate?
E) indeterminable from the information provided. 3 The table below shows total output for an economy over 2 years.
Good C Price
100 units 2008
Good A $2.00
Good B $3.00
Good C $10.00 Quantity
98 units TABLE 20 -3
14) Refer to Table 20 - 3. The real GDP in 2008, expressed in 2007 prices, was
A) $ 700.
B) $ 840.
C) $ 970.
D) $1 010. E) $1 740. 15) There will be no gains from specialization and trade between two countries if
A) neither country has an absolute advantage in the production of any good.
B) neither country has a comparative advantage in the production of any good.
C) opportunity costs are the same in the two countries.
D) there are no economies of scale.
E) both B and C are correct.
The supply and demand schedules for dozens of roses are given below:
Price Quantity Supplied per period Quantity Demanded per period
$10 200 500
$20 300 450
$30 400 400
$40 500 350
$50 600 300
16) Refer to Table 3- 1. The equilibrium price for a dozen roses is ________.
D) $40 4 E) $50 FIGURE 21-1
17) Refer to Figure 21- 1. The marginal propensity to save is given by
B) DE/Y2 Y3.
C) DF/ Y2 Y3.
A) DE/Y1 Y3. D) FE/Y1 Y3. E) FE/Y2 Y3. 18) Suppose Andrea has a job that pays her $25 000 per year (after taxes). She is considering quitting her job and
going to university full time for four years. Tuition fees and books will cost $12 000 per year. Living expenses
will cost $5 000 per year. What is the opportuni...
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