Multiple Choice Answers

Sebastian Stabilio just joined a team of people from throughout his organization whose primary task is to recommend valuable uses for the scrap generated in the manufacturing process. The team meets twice per week; otherwise members work within the usual organizational structure. The team, not permanent, which Sebastian has joined, would be considered a:
A. Parallel team
B. Work team
C. Project team
D. Working group
E. Project group

A manager’s ability to stimulate people to be high performers is referred to as:
A. Staffing
B. Organizing
C. Planning
D. Controlling
E. Leading
Resources are __________.
A. plentiful for households and plentiful for economies
B. scarce for households and scarce for economies
C. plentiful for households but scarce for economies
D. scarce for households but plentiful for economies

There are two types of markets in which firms face some competition yet are still able to have some control over the prices of their products. The names given to these market structures are __________.
A. duopoly and imperfect competition
B. perfect competition and monopolistic competition
C. duopoly and triopoly
D. monopolistic competition and oligopoly
A logical starting point from which the study of international trade begins is __________.
A. the principle of comparative advantage
B. the principle of absolute advantage
C. the recognition that government intervention in markets sometimes enhances the economic welfare of the society
D. the recognition that not all markets are competitive

Lucy starts her own psychiatric practice, but her expenditures to open the practice exceed her income. Lucy is a __________.
A. borrower who supplies money to the financial system
B. saver who demands money from the financial system
C. borrower who demands money from the financial system
D. saver who supplies money to the financial system

If a price ceiling is a binding constraint on the market, __________.
A. buyers cannot buy all they want to buy at the price ceiling
B. the equilibrium price must be below the price ceiling
C. sellers cannot sell all they want to sell at the price ceiling
D. there is excess supply

Which of the following statements about GDP is correct?
A. GDP increases if the total population increases.
B. GDP measures two things at once: the total income of everyone in the economy and the unemployment rate.
C. GDP is to a nation’s economy as household income is to a household.
D. Money continuously flows from households to government and then back to households, and GDP measures this flow of money.

Institutions in the economy that help to match one person’s saving with another person’s investment are collectively called the __________.
A. financial system
B. Federal Reserve system
C. monetary system
D. banking system

In the market for foreign-currency exchange in the open economy macroeconomic model, the amount of net capital outflow represents the quantity of dollars __________.
A. demanded for the purpose of importing foreign goods and services
B. supplied for the purpose of selling assets domestically
C. demanded for the purpose of buying U.S. net exports of goods and services
D. supplied for the purpose of buying assets abroad

The part of the balance of payments account that records the amount of foreign currency the government buys or sells is the:
A. balance of trade.
B. current account.
C. government financial account.
D. financial and capital account.

The part of the balance of payments account that lists all long-term flows of payments is called the:
A. balance of trade.
B. current account.
C. government financial account.
D. financial and capital account.
The model of aggregate demand and aggregate supply explains the relationship between __________.

A. real GDP and the price level
B. the price and quantity of a particular good
C. wages and employment
D. unemployment and output

The Federal Reserve will tend to tighten monetary policy when __________.
A. it thinks inflation is too high today, or will become too high in the future
B. interest rates are rising too rapidly
C. the growth rate of real GDP is quite sluggish
D. it thinks the unemployment rate is too high

The open-economy macroeconomic model includes __________.
A. neither the market for loanable funds or the market for foreign-currency exchange
B. only the market for loanable funds
C. both the market for loanable funds and the market for foreign-currency exchange
D. only the market for foreign-currency exchange