Question 1: The US is one of the wealthiest nations on earth, yet our fundamental economic problem is scarcity. How can this be? Also, what are the broadest and narrowest measures of money and how are they used?
Question 2: Contrast and discuss capitalism's and socialism's solutions to the three economic problems (what, how & for whom to produce).
Question 3: Most economists oppose trade restrictions because of the negative effects they may create. What are the main problems associated with trade restrictions?
Question 4: What does the law of supply say that most individuals would do if their wage increased? Explain the importance of substitution in this decision.
Question 5: Discuss the six roles of government in a market economy. According to economic theory, to what extent should government intervene in our economy?
Question 6: What is potential output and how is it related to the target rate of unemployment and the target level of capacity utilization? Which is greater: potential or actual output during a recession? During an economic boom?
Question 7: Name and discuss the assumption economists make that allows them to focus only on supply in the long run? (Hint: it's a Frenchman's law).
Question 8: What was the Keynesian's main argument against the classical view that the economy will get itself out of the depression?
Question 9: Discuss what is the difference between induced and autonomous expenditures. And, in what way the trust fund is not a real solution to the Social Security problem?
Question 10: Discuss how open market operations affect interest rates through the bond market.
Question 11: In what way is inflation a tax?