The purpose of a production possibilities graph is to:
a) enable a country to mobilize to win a war
b) keep an economy from having nonproductive workers
c) show alternative ways to use an economy's resources
d) make it possible to increase an economy's output
Answer: c) show alternative ways to use an economy's resources
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According to the efficient markets hypothesis, who should earn the highest risk-adjusted return on stocks?
A) a financial expert who can devote considerable time to research B) the average investor who doesn't do too much research C) someone throwing darts at possible stock picks D) all of the above should earn the same average return
Figure 36-2
Which of the following explains the movements in Figure 36-2?
A. An increase in the U.S. price level B. A decrease in the U.S. price level C. An appreciation of the U.S. dollar D. An expansionary monetary policy