In the diagram above, what will happen if the government sets the minimum wage at Point B?
a) There will be a shortage of workers.
b) There will be a surplus of workers.
c) The minimum wage will rise to meet equilibrium.
d) The minimum wage will fall to meet equilibrium.



Lowering the discount rate can promote full employment because
a) employees are more likely to apply for multiple jobs
b) employees are able to get better offers for hourly wages
c) companies are more likely to expand and hire more workers
d)companies are less likely to sign up employees for unemployment insurance




How do member banks of the Federal Reserve differ from other depository institutions?

a) They participate in the Federal Open Market Committee.
b) They receive services from the regional Federal Reserve Bank.
c) They are stockholders in their regional Federal Reserve Bank.
d) They are subject to the banking regulations issued by the Federal Reserve.

Which of the following circumstances usually comes before a period of economic contraction?

a) Decreasing inflation
b) High unemployment
c) Low GDP
d) Peak production


Use this image to answer the following question. When the economy is operating at point C, the U.S. Congress is most likely to follow

a) expansionary fiscal policy
b) contractionary fiscal policy
c) expansionary monetary policy


During a cold winter, there is a natural-gas shortage. The government sets a price ceiling on natural gas so that people can continue to afford heating. If the price ceiling remains in effect, what will happen?

a) Quantity demanded will exceed the quantity supplied.

b) Quantity demanded will equal the quantity supplied.

c) Quantity demanded and supplied will reach price equilibrium.

d) Quantity demanded will be lower than the quantity supplied.

e) Which of these could result from decreased federal spending?

f) Advances in the space program

g) Fewer social programs
h) Increased national debt

i) More government regulation