In the figure above, Joe is producing at point A. Joe's opportunity cost of producing one shirt is
A) 5/3 of a pair of pants per shirt.
B) 3/5 of a pair of pants per shirt.
C) 5 pairs of pants per shirt.
D) 2 pairs of pants per shirt.
D
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A White House proposal to increase infrastructure spending on roads, rail lines and runways is an example of
A) expansionary fiscal policy. B) insourcing policies. C) automatic stabilization. D) contractionary fiscal policy.
In order to keep the real wage rate constant, the
A) inflation rate must be exactly one half of the expected inflation rate. B) money wage rate must increase by the same amount as the inflation rate. C) money wage rate must increase when the price level falls. D) money wage rate must decrease by the same amount as the inflation rate. E) nominal interest rate must be equal to the inflation rate.