2. Indicate whether each of the following statements applies to microeconomics or macroeconomics. L01.3
a. The unemployment rate in the United States was 3.7 percent in December 2018.
b. A U.S. software firm laid off 15 workers last month and transferred the work to India.
c. An unexpected freeze in central Florida reduced the citrus crop and caused the price of oranges to rise.
d. U.S. output, adjusted for inflation, increased by 2.3 percent in 2017.
e. Last week Wells Fargo Bank lowered its interest rate on busi-ness loans by one-half of i percentage point f. The consumer price index rose by 2.2 percent from Novem-ber 2017 to November 2018.
4. Suppose that you are given a $100 budget at work that can be spent only on two items: staplers and pens. If staplers cost $10 each and pens cost $2.50 each, then the opportunity cost of purchasing one stapler is. I-01A a. 10 pens. b. 5 pens c. zero pens. d. 4 pens
1. Decide whether each (.lf the following descriptions most closely corresponds to being part of a command system, a market system, or a laissez faire system. L02.1
a. A woman who wants to start a flower shop finds she cannot do so unless the central government has already decided to allow a flower shop in her area
b. Shops stock and sell the goods their customers want, but the government levies a sales tax on each transaction in order to fund elementary schools, public libraries, and welfare pro-grams for the poor.
c. The only taxes levied by the government are to pay for national defense, law enforcement, and a legal system designed to enforce contracts between rITIVatP riti7pne
5. Identify each of the following quotes as being associated with either the concept of the invisible hand or the concept of creative destruction. L02.4
a. “If you compare a list of today’s most powerful and profit able companies with a similar list from 30 years ago, you will see lots of new entries ”
b. “Managers in the old Soviet Union often sacrificed product quality and variety because they were being awarded bonuses for quantitative, not qualitative, targets.”
c. “Each day, central planners in the old Soviet Union were tasked with setting 27 million prices—correctly.”
d. it is not from the benevolence of the butcher, the brewer, or the baker that we expect our dinner, but from their regard to their own interest “
