Figure 2-9
Assume that the publishing industry produces novels and textbooks, as shown in the production possibilities frontier in . Moving from point H to G, the opportunity cost of those five additional textbooks equals
a.
0.5 novels
b.
10 million novels
c.
3 novels
d.
8 novels
e.
2 novels
b
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Suppose that one-year treasury bills yield 8 percent in the United States and 6 percent in Japan. Investors will prefer to purchase the U.S. securities, unless they expect the dollar to __________ against the yen over the next year
A) depreciate by less than 2 percent B) depreciate by more than 2 percent C) appreciate by less than 2 percent D) appreciate by more than 2 percent
Refer to the above figure. If the government set a price floor of $3.50 per gallon, there would be
A) an excess quantity demanded equal to 100,000 gallons. B) an excess quantity supplied equal to the distance BD. C) an excess quantity supplied equal to the distance BF. D) an excess quantity supplied equal to 100,000 gallons.