Given the production possibilities schedule in the above table, a combination of 75 televisions and 60 personal computers
A) is attainable but involves the unemployment of some of society's resources.
B) clearly illustrates the trade-off between televisions and computers.
C) cannot be produced by society, given its current level of resources and production technology.
D) can be produced only if society is willing to have some of its resources used inefficiently.
C
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If you accept the rational expectations hypothesis as accurate, what would you tell monetary policy makers who ask you how to more effectively manage the economy?
A) Individuals do understand how monetary policy works, so consistency and predictability are the keys to effective policy making. B) Only unanticipated policies will be effective once individuals understand how monetary policy works. C) Consumers do not understand the workings of monetary policy, so discretionary and nondiscretionary policies are equally effective. D) Individuals base their economic expectations solely on current information, so repeating policy decisions that have worked in the past is the most effective path to take.
The IS curve would unambiguously shift up and to the right if there were
A) an increase in both government purchases and corporate taxes. B) an increase in both government purchases and the expected future marginal product of capital. C) an increase in the expected future marginal product of capital and a decrease in expected future output. D) a decrease in both corporate taxes and the expected future marginal product of capital.