Question 1. The real wage
a. equals the amount of goods and services that can be bought.
b. is the amount of money received per unit of time.
c. is not adjusted for changes in the price level.
d. will rise faster than the money wage as the price level rises.
e. is the same as the money wage.
Question 2. Economic resources have a price above zero because
a. there are no other uses for them.
b. they cannot be easily moved from place to place.
c. otherwise they would not be able to satisfy human wants.
d. they are relatively scarce.
e. they are unlimited in supply
Question 3. The banking system creates money in the sense that it
a. prints money
b. creates excess reserves from loans
c. creates loans from excess reserves
d. creates required reserves from loans
e. creates loans form required reserves
Question 4. A production possibilities curve illustrates.
a. opportunity costs.
b. a market
c. principles of taxation.
d. income distribution.
Question 5. Interest rates
a. help ensure that only those projects with the greatest expected productivity will be undertaken.
b. are not really needed in modern planned economy.
c. arise solely because investment projects entail risk.
d. vary directly with the capitalized value of an asset.
e. are synonymous with money wage