Which of the following leads to an increase in the budget deficit?

Select one:

a.

An increase in exports

b.

Reducing the pay scale for public sector workers

c.

Higher tax rates

d.

Increased borrowing by the government

e.

Reduction in social security benefits

A small number of countries own and control the world's oil supply, which allows them to set a high markup on the price of oil. This is an example of:

Select one:

a.

income inequality.

b.

resource curse.

c.

market failure.

d.

corporate greed.

e.

risk and uncertainty.

Abbott Farms is a corn producer for the US domestic market. Which of the following would be a part of the production process for corn?

Select one:

a.

Number of people working on the farm

b.

Unemployment rate

c.

The dollar-euro exchange rate

d.

The demand for corn syrup

e.

The number of other corn farms in the vicinity

An economic research firm hires an economist to study the impact of a hike in the savings deposit rate on the level of investment in the economy. What area of economics does this fall under?

Select one:

a.

Macroeconomics

b.

Game theory

c.

Microeconomics

d.

Political economy

e.

Industrial organization

The prices of handbags go up as the cost of leather increases in a country. Which of the following is likely to be true?

Select one:

a.

People will demand more handbags.

b.

Fewer handbags will be sold.

c.

Revenue per unit will decline for the sellers.

d.

People will stop buying leather handbags altogether.

e.

The supply of handbags will remain unchanged.

While making a purchase decision, consumers analyze:

Select one:

a.

the cost of production.

b.

the associated costs and benefits.

c.

the level of government intervention in the market.

d.

the availability of inputs.

e.

the ability of sellers to adjust supply to market signals.

What does a positive rate of inflation show?

Select one:

a.

The economy is exporting more goods than before.

b.

The standard of living of people in the country has risen.

c.

The number of individuals looking for a job has increased.

d.

Commodities are more expensive than they were earlier.

e.

The total production of goods and services has gone up.