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CHAPTER 8—THE CLASSICAL LONG-RUN MODEL
MULTIPLE CHOICE
1. Classical economists believed that production could be stuck below its full employment level for a
long period of time.
a. True
b. False
ANS: B PTS: 1 DIF: 1
NAT: Financial theories, analysis, reporting, and markets
LOC: Understanding and applying economic models
TOP: Macroeconomic Models: Classical versus Keynesian
2. One reason why economists often appear to disagree when asked about the impact of some bad
economic news is that
a. they do not understand the economy very well
b. economics is a very difficult science, and so there are many incorrect economic
projections being made
c. economists rarely disagree; people just think they are disagreeing because they do not
understand the language of economics
d. economists often appear to be disagreeing when one is talking about long-run impact
while the other is referring to short-run impacts
e. economists are by nature competitive individuals and they often disagree
ANS: D PTS: 1 DIF: 1
3. According to classical economics,

a. the economy moves to full employment in the long run
b. the economy is always at full employment in the short run
c. the economy is rarely at full employment
d. business cycles explain long-run fluctuations in the economy
e. the economy is at full employment in the short run, but in the long run, business cycle
movements lead the economy away from full employment
ANS: A PTS: 1 DIF: 2
4. Which of the following is more of a short-run than a long-run goal?

a. Increasing the capital stock
b. Encouraging investment in human capital
c. Moderating economic fluctuations
d. Stimulating economic growth
e. Increasing private investment
ANS: C PTS: 1 DIF: 1
5. What key observation did the classical model attempt to explain?
a. the economy performs well in the short run, but not so well in the long run
b. business cycles are the most important economic problem
c. over the short run, the economy performs rather poorly
d. markets do not clear without government intervention
e. over the long run, the economy performs rather well
ANS: E PTS: 1 DIF: 2
6. The short-run macro model

a. is an attempt to explain why the economy tends to perform better in the short run than in
the long run
b. was developed during the Great Depression to explain the economy's continuing poor
performance
c. lost its popularity during the 1950s
d. was developed during the early 19th century
e. explains the forces that work to drive the economy to full employment
7. What major historical event led to the most significant challenge to classical economic thinking?
a. The war on poverty
b. The American Revolution
c. World War II
d. The Great Depression
e. The oil shocks of the 1970s
8. John Maynard Keynes and his followers argued that

a. the classical model does a good job of explaining the economy's operation in both the
short run and long run
b. the short run is unimportant so economists should focus their attention on the long run
c. the economy should be allowed to function with minimal government interference
d. the economy operates the same way in both the short run and long run
e. while the classical model might explain economic performance in the long run, the long
run could take a long time to reach
9. According to Keynesian economists,

a. the economy will return quickly to full employment in most cases
b. if output is below its potential, the economy will soon return to full employment
c. production can be stuck below its full-employment level for extended periods of time
d. the Great Depression proved that classical economics does a good job of explaining how
the economy operates
e. he economy will achieve full employment in the short run but, in the long run, GDP will
fluctuate
10. Which of the following events triggered intense debate over the classical model of the economy?
a. The U.S. Civil War
b. World War I
c. the Baby Boom
e. World War II
11. Which economic phenomenon is the short-run macro model most useful in explaining?
a. The sources of employment in the long run
b. The trend of output in the long run
c. The sources of cyclical unemployment
d. The reasons why some workers become discouraged
e. The sources of long-run economic growth
12. The classical model

a. is another name for the short-run macro model
b. was developed to explain the long period of poor economic performance during the Great
Depression
c. is an attempt to explain why the economy tends to perform rather well over long periods
of time
d. is believed by most economists to be a better explanatory model for short-term, rather than
long-term, economic performance
e. was not really accepted as a legitimate economic theory until the 1950s
13. Which of the following statements about modern macroeconomic theory is most accurate?
a. Keynes' ideas help us understand movements in output around its long-run trend, while the
Classical model is more useful in explaining the long-run trend itself.
b. The classical model helps us understand movements in output around its long-run trend,
while the short-run macro model is more useful in explaining the long-run trend itself.
c. Both classical and short-run macro models help us understand movements in output
around its long-run trend, but neither model is effective at explaining the long-run trend
itself.
d. Neither the classical nor the short-run macro model helps us understand movements in
output around its long-run trend, but both are useful in explaining the long-run trend itself.
e. Only the short-run macro model is useful in understanding movements in output around its
long-run trend, and in explaining the long-run trend itself.
14. Which of the following is a definition of economic fluctuations?

a. Movements in prices around their long-run trend
b. Shifts in the long-run trend of output
c. Movements of the real wage over the long run
d. Shifts in the long-run trend of prices
e. Movements in output around its long-run trend
15. The Classical model

a. is now discredited
b. was developed by John Maynard Keynes
c. has been completely displaced by the short-run macro model
d. helps us to understand the performance of the economy in the long run
e. is most useful in helping us to predict when an economic downturn will occur
16. Which of the following real-world phenomena does the classical model ignore?
a. Frictional unemployment
b. Inflation
c. Real output growth
d. Cyclical unemployment
e. Structural unemployment
17. A critical assumption in the classical model is that markets are always clear.
a. True
b. False
TOP: Assumptions of the Classical Model
18. A critical assumption in the classical model is that

a. markets are perfectly competitive in the short run
b. markets clear in the long run
c. markets clear in the short run
d. markets are perfectly competitive in the long run
e. all variables are expressed in nominal terms
19. A key assumption of the classical model is that

a. government intervention is important to get markets to clear
b. prices adjust until quantity supplied equals quantity demanded
c. markets never clear in the long run
d. demand adjusts in order to meet supply
e. prices remain constant and supply and demand adjust
20. Which of the following is true for a market that clears?

a. An excess supply of anything traded will lead to a fall in its price.
b. An excess demand of anything traded will lead to a fall in its price.
c. An excess supply of anything traded will lead to a rise in its price.
d. An excess demand of anything traded will not lead to a price change.
e. A high price will lead to a high demand.
21. The market clearing assumption is

a. a central assumption of the short-run macro model
b. the idea that prices in every market will adjust until quantity supplied and quantity
demanded are equal
c. the idea that excess supply always leads to an increase in demand
d. the idea that markets only work when they are in equilibrium
e. believed by most economists today to be an unreasonable assumption
22. Markets clear

a. in the short run
b. when a depression occurs
c. when a recession occurs
d. roughly every ninety days
e. eventually
23. Because markets may not clear for several months or even several years, the classical model
a. is no longer considered valuable by mainstream economists
b. has no value when explaining a situation where excess supply exists
c. is irrelevant to any discussion of a market in which excess demand exists
d. does a better job of explaining short-term fluctuations than long-run growth
e. does a better job of explaining long-run growth than short-run fluctuations
24. The desire for goods and services is

a. created by a market economy
b. the ultimate explanation for all production
c. why it is so difficult to explain how our economy works
d. the cause of inflation
e. what causes the market wage for labor to continually increase
TOP: How Much Output Will We Produce?
25. In the classical long-run model,

a. we focus on labor resources, rather than capital or land
b. we study thousands of different resource markets
c. we concentrate our attention on three resource markets: land, labor, and capital
d. we focus on two markets: households and firms
e. the number of variables we include depends upon whether we are focusing on the short
run or the long run
26. The classical model

a. relies on the equivalency of the labor, capital, and land resource markets
b. includes a land market and a labor market
c. focuses primarily on capital markets
d. focuses primarily on labor markets
e. focuses on labor, capital, and land markets
27. If the actual real wage exceeds the equilibrium wage, there will be an excess supply of labor.
a. True
b. False
LOC: Understanding and applying economic models TOP: The Labor Market
28. In the classical view, all markets clear, except the labor market.
a. True
b. False
29. According to the classical model, there is no need for government intervention in the economy. if the
economy is left alone, full employment output will eventually occur.
a. True
b. False
30. The labor supply curve shows

a. how much output a firm will supply with a given amount of labor
b. how much labor a firm will want to hire at each wage rate
c. how much output people will want to buy if they supply a given amount of labor
d. how much labor a firm will need with a given amount of machinery and equipment
e. how many people will want jobs at each wage rate
31. The labor demand curve shows the

a. number of workers that firms will want to hire at any wage rate
b. number of people who will want jobs at any wage rate
c. amount of labor that a firm needs to produce a given amount of output
d. equilibrium wage rate and number of workers employed
e. amount of output workers will be able to buy for a given number of hours worked
32. Which of the following groups would be considered suppliers in the labor market?
a. Government agencies
b. Firms
c. Households
d. Stockholders
e. Landlords
33. The supply of labor

a. varies inversely with the price level
b. does not vary with the real wage rate
c. does not vary with the price level
d. varies directly with the price level
e. varies inversely with the nominal wage rate
34. The labor supply curve

a. slopes upward to illustrate that more people will want to work as the real wage increases
b. slopes upward to illustrate that changes in the real wage are directly proportional to
changes in the nominal wage
c. may slope either upward or downward, depending upon the real wage
d. slopes downward to illustrate that a decrease in the real wage decreases the number of
individuals willing to work
e. slopes downward to illustrate that the availability of workers is directly proportional to the
real wage
35. The labor demand curve slopes

a. upward to illustrate that the more productive the worker, the higher the real wage the
employer is willing to pay that worker
b. upward to illustrate that the higher the wage rate, the fewer workers are demanded
c. upward or downward in direct proportion to the rate of inflation
d. downward to illustrate that the lower the real wage, the more workers employers are
willing to hire
e. downward to illustrate that the availability of workers is directly proportional to the real
wage
36. Refer to Figure 8-1. According to the graph, the equilibrium real hourly wage and quantity of labor
employed, respectively, are
a. $10, 110 million workers
b. $8, 130 million workers
c. $8, 150 million workers
d. $6, 150 million workers
e. $6, 130 million workers
37. Refer to Figure 8-1. If the real hourly wage rate was $6, what would be the effect?
a. There would be a shortage of 40 million workers and the wage rate would rise.
b. There would be a shortage of 20 million workers and the wage rate would rise.
c. There would be a surplus of 40 million workers and the wage rate would fall.
d. There would be a surplus of 20 million workers and the wage rate would fall.
e. There would be unemployment.
38. Refer to Figure 8-1. What would be the effect if the real wage was $2 above the equilibrium wage?
a. There would be a shortage of 40 million workers and the wage rate would rise.
b. There would be a shortage of 20 million workers and the wage rate would rise.
c. There would be a surplus of 40 million workers and the wage rate would fall.
d. There would be a surplus of 20 million workers and the wage rate would fall.
e. The government would set a minimum wage.
39. Refer to Figure 8-1. If the labor market is in equilibrium, there is no

a. unemployment
b. frictional unemployment
c. structural unemployment
d. seasonal unemployment
e. cyclical unemployment
40. The labor demand curve slopes downward because

a. firms wish to hire fewer workers as the wage rate increases
b. households wish to hire fewer workers as the wage rate decreases
c. firms wish to hire more workers as the wage rate increases
d. firms wish to supply fewer workers as the wage rate increases
e. households wish to provide fewer hours of work as the wage rate decreases
41. In a labor market diagram, the point at which the labor supply curve crosses the labor demand curve is
a. the point at which all workers are employed at the salary at which they would prefer to be
employed
b. the point at which all jobs are filled at the wage employers prefer to pay
c. the point at which everyone who wants to work is able to find a job
d. a point at which we have excess labor supply, causing unemployment
e. the point at which excess demand for labor drives the wage rate upward
42. Which of the following is not an accurate description of the point at which the labor supply and labor
demand curves meet?
a. The point at which the market for labor has cleared
b. The real wage at which the quantity of labor demanded is equal to the quantity of labor
supplied
c. The point at which there is no frictional unemployment
d. The point at which there is no unemployment
e. The wage at which the number of workers firms want to hire is equal to the number of
people who want jobs
43. According to classical economists,

a. full employment means zero unemployment
b. as long as markets clear, no government action is needed to ensure full employment
c. even if all markets clear, government action is needed to correct labor market
imperfections if the economy is to reach full employment
d. as long as markets clear and government provides jobs to those who need them, the
economy will be at full employment
e. even if markets clear, cyclical unemployment will still persist in the long run
44. According to the classical model, if there are too many elementary school teachers in the labor market,
a. the government should institute a retraining program to give the unemployed teachers new
job skills
b. the wages for elementary teachers will fall, eventually causing the number of excess
teachers to shrink
c. the wage for elementary teachers will increase for those who are employed, but
unemployment of teachers will remain high
d. this situation provides an example of cyclical unemployment, which often occurs in the
long run
e. people will quit training to become elementary school teachers and soon there will be a
shortage in this labor market
45. If the labor supply and demand curves cross at a wage of $20,
a. a wage rate of $10 per hour would lead to an excess demand for labor
b. a wage rate of $10 per hour would lead to an excess supply of labor
c. that wage causes a high rate of cyclical unemployment
d. employees are overpaid
e. a wage rate of $10 per hour would mean there is a significant amount of structural
unemployment
46. It is possible for an economy to produce more than its potential level of output, at least for a short
period of time.
a. True
b. False
TOP: Determining the Economy's Output
47. The aggregate production function shows us that increasing the number of workers employed will
increase output at a constant rate.
a. True
b. False
48. Diminishing returns to labor occur for two primary reasons: 1) as we keep adding new workers, it
becomes increasingly difficult to obtain productivity gains through additional specialization; and 2)
each additional worker we add has less land and capital to work with.
a. True
b. False
49. A country's total output, or real GDP, is determined only by its aggregate production function.
a. True
b. False
50. The economy's level of output depends upon (1) the

a. amount of land and capital available for labor to use and (2) the state of technology and
types of inputs available
b. cost of land and capital and (2) the cost of labor
c. availability of land and (2) the availability of capital
d. state of technology and (2) the cost of land
e. state of technology and (2) the types of inputs available
51. The classical model assumes that

a. the supply of labor is fixed
b. the stock of capital and technology are fixed
c. the stock of capital and technology grows at a constant rate
d. the supply of labor grows at a constant rate
e. the supply of labor grows at an increasing rate.
52. The aggregate production function shows how much output the economy can produce
a. with different quantities of labor, land, capital and states of technology
b. with different quantities of labor and capital, for given amounts of land and a given state
of technology
c. with different quantities of labor, for given amounts of land and capital, and a given state
of technology
d. with a given amount of money
e. with different amounts of money and given amounts of land, labor, capital, and a given
state of technology
53. Which of the following is a definition of the aggregate production function?

a. the relationship describing which inputs an economy can use with different quantities of
labor
b. the relationship describing how much labor an economy can supply with different
quantities of capital
c. the relationship describing how much output an economy can produce with different
quantities of labor
d. the relationship describing what services an economy can produce with different quantities
of capital
e. the relationship describing how much output a firm can produce with different quantities
of capital
54. The aggregate production function is the

a. relationship between the amount of labor employed in the economy and the total amount
of output produced
b. relationship between available labor and the total amount of output produced
c. the relationship between land and capital and labor employed in the economy
d. long-run equilibrium of the macroeconomy
e. amount of output any worker can produce given existing land and capital constraints
55. Which of the following best describes the aggregate production function if output is measured on the
vertical axis and the number of workers employed is measured on the horizontal axis? The curve is
a. downward sloping and becomes flatter as the number of workers employed increases
b. downward sloping and becomes steeper as the number of workers employed increases
c. downward sloping with the same slope throughout
d. upward sloping and becomes steeper as the number of workers employed increases
e. upward sloping and becomes flatter as the number of workers employed increases
56. What is the effect of diminishing returns to labor on the slope of the aggregate production function
(where output is measured on the vertical axis and employment is measured on the horizontal axis)?
a. It implies that the slope of the curve increases as the number of workers employed
increases.
b. It implies that the slope of the curve becomes negative as the number of workers employed
increases.
c. It implies that the slope of the curve decreases (or becomes flatter) as the number of
workers employed increases.
d. It keeps the slope the same throughout.
e. It has nothing to do with the slope of the aggregate production function.
57. Refer to Figure 8-2. The economy's potential level of output on the graph
a. cannot be determined with this information, only actual output can be found
b. is rising
c. exceeds $8 trillion
d. is less than $8 trillion
e. equals $8 trillion
58. Refer to Figure 8-2. The economy is at full employment if
a. the quantity of labor supplied exceeds the quantity demanded
b. the quantity of labor demanded exceeds the quantity supplied
c. 130 million workers are employed
d. the real hourly wage is rising
e. we reach the maximum point on the production function
59. What is the full-employment output level?

a. The output level that results when the loanable funds market clears
b. The output level that results when the returns to labor are zero
c. The output level that results when factories are completely full
d. The output level that results when the labor market clears
e. The output level that would occur if the output level was positive.
60. An aggregate production function, when shown on a graph,

a. is linear and slopes upward
b. is linear and slopes downward
c. is horizontal
d. is vertical
e. slopes upward, and flattens out as more labor is used
61. The aggregate production function is the relationship between the

a. total cost of labor and the quantity of output in the economy
b. total cost of labor and the total real cost of inputs
c. quantity of labor employed in the economy and the total quantity of output produced
d. cost of labor and the supply of labor
e. quantity of labor and the quantity of capital
62. Say's Law states that by purchasing goods and services, buyers stimulate firms to produce goods and
services equal to what has been purchased: Demand creates its own supply.
a. True
b. False
TOP: Total Spending in a Very Simple Economy
63. According to Say's Law, supply creates its own demand.

a. True
b. False
64. Say's Law is the idea that

a. in the long run, the economy reaches full employment automatically
b. the aggregate production function, along with the labor market, determines the economy's
level of output
c. total output will always exceed total spending
d. whenever a good or service is produced, an equal amount of income is created
e. markets always clear
65. Refer to Figure 8-3. This figure is known as

a. the classical aggregate production function
b. the Keynesian aggregate production function
c. the full-employment model
d. the circular flow diagram
e. Say's diagram
66. After examining Figure 8-3, it is possible to conclude that
a. people do not save money nor pay taxes in this model
b. firms purchase resources from households and other firms in this model
c. households are the only ones who purchase and firms the only ones who sell in this model
d. completion of a sale represents a break in the flow of goods and services, and inputs in this
model
e. all households and firms individually receive the same amount of money in this model
67. Factor payments are

a. amounts paid to resource owners for the use of their resource
b. amounts paid for goods
c. another term for revenues
d. the amount households put into savings
e. payments made to workers who are employed only part time
68. According to Say's Law, in the aggregate

a. demand creates its own supply
b. the production of output will generate exactly enough income to purchase what has been
produced
c. the economy is incapable of producing output fast enough to ensure full employment
d. full employment cannot be sustained without government action
e. consumer saving prevents the economy from reaching full employment
69. The economist that gave us the proposition that "supply creates its own demand" was
a. Adam Smith
b. Jean Baptiste Say
c. Marc Lieberman
d. John Maynard Keynes
e. Robert Hall
70. Say's Law

a. is valid only in a simple economy without financial markets
b. led economists during the 1920s to encourage the government to adopt flawed economic
policies that led to the Great Depression
c. assures us that in the aggregate, firms are able to sell their output so that full employment
can be sustained
d. tells us that in the long run, markets clear
e. tell us that firms must carefully monitor consumer spending and saving in order not to
produce more than consumers are willing to purchase
71. Net taxes are

a. the total amount of taxes paid to the government
b. total tax revenues of the federal government
c. total tax revenues plus transfer payments
d. total tax revenues minus transfer payments
e. total tax revenues minus taxes paid by firms
TOP: Total Spending in a More Realistic Economy
72. Transfer payments, such as unemployment insurance and welfare, are included in the circular flow as
part of
a. government purchases
b. household saving
c. net taxes
d. planned investment spending
e. household consumption
73. Using the following information on a hypothetical economy in equilibrium, calculate total output for
2008.
Consumption Spending $3.5 trillion

Net Taxes $2.7 trillion
Household Saving $2.5 trillion
Investment Spending $2.2 trillion
Government Purchases $3.0 trillion
Exports $1.1 trillion
Imports $1.1 trillion
Total output for 2008 is

a. $5.2 trillion
b. $5.7 trillion
c. $8.4 trillion
d. $8.7 trillion
e. $13.9 trillion
74. What is the relationship between total taxes and net taxes?
a. total taxes = net taxes  transfer payments
b. net taxes = total taxes + local taxes
c. net taxes = transfer payments / total taxes
d. total taxes = net taxes - transfer payments
e. total taxes = net taxes + transfer payments
75. What is the relationship between household saving and taxes?

a. taxes = income - consumption - household saving
b. household saving = income + taxes - consumption
c. taxes = income + consumption + household saving
d. household saving = consumption + income - taxes
e. taxes = household saving - income + consumption
76. In a typical economy, the dollar value of the total output for a period will equal the sum of
consumption spending, planned investment spending, government spending, and net tax revenue.
a. True
b. False
LOC: Understanding and applying economic models TOP: Leakages and Injections
77. Saving and taxes are considered leakages from the spending stream.
a. True
b. False
78. Which of the following is a leakages from the circular flow?

a. Household saving and government spending
b. Business investment and household saving
c. Net taxes and household saving
d. Government spending and business investment
e. Net taxes and government spending
79. Which of the following statements is true when total spending equals total output?
a. Saving plus taxes equals investment plus government purchases.
b. Output equals investment plus government purchases plus saving plus taxes.
c. Output equals consumption spending plus investment plus government purchases plus
saving plus taxes.
d. Output equals consumption plus investment plus taxes.
e. Saving plus investment equals taxes plus government purchases.
80. Assuming the economy was in equilibrium, use the following information to calculate the total value
of leakages.

Total leakages are

a. $2.5 trillion
b. $2.7 trillion
c. $3.0 trillion
d. $5.2 trillion
e. $5.7 trillion
81. Which of the following is an injection into the circular flow?

a. household saving and government spending
b. business investment and household saving
c. net taxes and household saving
d. government spending and business investment
e. net taxes and government spending
82. Leakages are

a. negative tax revenues
b. government spending on nonessential goods and services
c. amounts of income earned, but not spent, by the household sector during a given year
d. a sign that an economy's total output is excessive
e. sums spent by sectors other than households
83. In an economy without international trade, we can expect total output to equal
a. consumption spending plus investment spending plus government purchases
b. consumption spending minus leakages
c. the sum of leakages and injections
d. consumption spending plus investment spending
e. total spending minus leakages and injections
84. If an economy's consumption spending is $5 trillion, investment is $2 trillion, government spending is

$1 trillion, net taxes are $1 trillion and household saving is $2 trillion, total income is
a. $3 trillion
b. $5 trillion
c. $7 trillion
d. $8 trillion
e. $11 trillion
85. In the long run, if an economy's consumption spending is $5 trillion, its planned investment is $2
trillion, government spending is $1 trillion, net tax revenue is $1 trillion, and household savings are $2
trillion, total output should be
a. $3 trillion
b. $5 trillion
c. $7 trillion
d. $8 trillion
e. $11 trillion
86. Total spending will equal total output

a. after inventory adjustments
b. only when total leakages are equal to total injections
c. by the end of every year
d. only when the sum of saving and investment equals the sum of net taxes and government
expenditures
e. saving is equal to net taxes
87. Households make their savings available to borrowers through

a. resource markets
b. the loanable funds market
c. the labor market
d. the taxes
e. spending
LOC: Understanding and applying economic models TOP: The Loanable Funds Market
88. Which of the following markets must clear if injections from the income-spending stream are to equal
leakages from the stream?
a. The resource market
b. The labor market
c. The goods market
d. The aggregate market
e. The loanable funds market
89. Assuming the economy was in equilibrium, use the following information to determine the
government's budget deficit.

The government's deficit (surplus) was

a. -$0.3 trillion deficit ($0.3 trillion surplus)
b. -$0.2 trillion deficit
c. $0.2 trillion deficit
d. $0.3 trillion deficit
e. $0.5 trillion deficit
90. The government budget deficit is

a. the difference between government purchases and government revenues from bonds and
taxes
b. caused by a lack of business sector investment
c. created when the government expenditures exceed net taxes
d. caused by leakages in the economy
e. is created by government injections
91. What is the relationship between the government's budget deficit and its tax revenue?
a. Budget deficit = government spending + tax revenue
b. Budget deficit = government spending - tax revenue
c. Government spending = budget deficit / tax revenue
d. Tax revenue = government spending + budget deficit
e. Budget deficit = tax revenue - government spending
92. What is the price of funds in the loanable funds market?

a. The real wage rate
b. The Consumer Price Index
c. The interest rate
d. The profit rate
e. The GDP price index
93. Assuming the economy was in equilibrium, use the following information to determine the amount of
funds supplied to the loanable funds market.

a. $2.2 trillion
b. $2.5 trillion
c. $2.7 trillion
d. $3.0 trillion
e. $5.2 trillion
94. Assuming the economy was in equilibrium, use the following information to determine the total
amount of funds demanded in the loanable funds market.

a. $0.3 trillion
b. $2.2 trillion
c. $2.5 trillion
d. $3.0 trillion
e. $5.2 trillion
95. In the classical model, the supply of funds to the loanable funds market comes from
a. household saving and the government's budget surplus, if any
b. net taxes
c. household saving and the government budget deficit, if any
d. planned investment
e. total income
96. In the classical model, the quantity of loanable funds supplied is

a. positively related to the level of income
b. negatively related to the price level
c. positively related to the price level
d. negatively related to the interest rate
e. positively related to the interest rate
LOC: Understanding and applying economic models TOP: The Supply of Funds Curve
97. The supply of loanable funds curve

a. is upward sloping
b. is downward sloping
c. is horizontal
d. begins sloping upward, then levels off
e. may slope either upward or downward, depending upon the interest rate
98. The supply of loanable funds curve is upward-sloping because a rise in the interest rate
a. decreases the opportunity cost of firms' investment spending
b. stimulates the economy
c. decreases the opportunity cost to households of consuming
d. increases the opportunity cost to households of consuming
e. increases the government's desire to run a budget deficit
99. The demand for funds in the financial market comes from one source: the business sector's investment
spending.
a. True
b. False
TOP: The Demand for Funds Curve
100. Investment spending is inversely related to the interest rate.

a. True
b. False
101. The investment demand curve

a. is upward sloping
b. is downward sloping
c. is horizontal
d. begins sloping upward then flattens out
e. begins sloping downward, then flattens out
102. In the classical model, investment spending is

a. positively related to the level of income
b. positively related to the interest rate
c. negatively related to the interest rate
d. unrelated to the interest rate
e. negatively related to the price level
103. In the classical model, which of the following is treated as independent of the interest rate?
a. the quantity of loanable funds demanded by government
b. the quantity of loanable funds demanded by businesses
c. the total quantity of loanable funds demanded
d. household saving
e. the total quantity of loanable funds supplied
104. When represented graphically, the government's demand for funds curve is
a. downward sloping
b. upward sloping
c. vertical
d. initially downward sloping, then upward sloping
e. initially rightward sloping, then downward sloping
105. If the interest rate rises, the

a. quantity of loanable funds demanded by firms decreases
b. quantity of loanable funds demanded by government decreases
c. quantity of loanable funds demanded by firms increases
d. quantity of loanable funds demanded by government increases
e. demand for loanable funds curve shifts to the right
106. Suppose there are no firms, only the government and households. What would the total demand for
funds curve look like in such a world?
a. Downward sloping
b. Perfectly horizontal
c. Upward sloping
d. There would be no such curve
e. Perfectly vertical
107. Because financial markets clear, we know that leakages in the economy will equal injections and,
therefore, there will be enough spending in the economy to purchase whatever amount of output level
produced.
a. True
b. False
TOP: Equilibrium in the Loanable Funds Market
108. Refer to Figure 8-4. Based on these graphs, what is the total quantity of loanable funds demanded at
an interest rate of 5 percent?
a. $0.8 trillion
b. $1.0 trillion
c. $1.4 trillion
d. $1.8 trillion
e. $2.2 trillion
109. Refer to Figure 8-4. Based on these graphs, what are the equilibrium interest rate and quantity of
loanable funds exchanged?
a. 5 percent and $1.4 trillion
b. 5 percent and $2.2 trillion
c. 8 percent and $1.8 trillion
d. 8 percent and $2.8 trillion
e. It cannot be determined with the information given.
110. Suppose there are no firms, only the government and households. What would be the result if for some
reason the supply of saving at every interest rate suddenly fell?
a. Interest rates would fall and the level of saving would fall.
b. Interest rates would fall and the level of saving would not change.
c. Interest rates would rise and the level of saving would not change.
d. Interest rates would rise and the level of saving would fall.
e. Interest rates would not change and the level of saving would fall.
111. Refer to Figure 8-5. What is the equilibrium interest rate?

a. 4 percent
b. 6 percent
c. 8 percent
d. 10 percent
e. It cannot be determined with the information given.
112. The relationship between household saving and business investment spending in equilibrium is:
Planned investment = household saving - government spending + taxes
a. True
b. False
TOP: The Loanable Funds Market and Say's Law
113. If at an interest rate of 7 percent, planned investment is $2 trillion, government spending is $3 trillion,
net taxes are $2.8 trillion, and household saving is $2.2 trillion, what is the quantity of funds demanded
at an interest rate of 7 percent?
a. $1.8 trillion
b. $2.2 trillion
c. $2.8 trillion
d. $5.0 trillion
e. $5.8 trillion
114. In the classical model, the loanable funds market will clear when saving
a. equals investment plus government purchases minus net taxes
b. equals net taxes
c. equals investment
d. equals investment plus government purchases
e. minus taxes equals investment plus government purchases
115. In the classical model, if the amount households wish to save exceeds the sum of the amount
businesses wish to invest plus the government's budget deficit, the loanable funds market
a. will be in disequilibrium, but this does not prevent equilibrium in the total economy
b. will be in disequilibrium, and we would expect the supply of funds to decrease
c. will be in disequilibrium, and we would expect the interest rate to rise
d. will be in disequilibrium, and we would expect the interest rate to fall
e. may be in equilibrium, because unplanned inventory changes have not been included
116. Say's Law

a. cannot be satisfied if there is excess supply or demand in individual markets in the long
run
b. ensures that every firm will sell all of its output
c. can be satisfied even if there is a general overproduction or underproduction of goods in
the economy
d. is satisfied only if every market clears in the short run
e. shows that the total value of spending in the economy will equal the total value of the
output produced
117. The classical model is based on the assumption that

a. all markets clear
b. all demand curves are horizontal
c. all supply curves are vertical
d. the government's budget is always balanced
e. the quantity of loanable funds demanded is independent of the interest rate
TOP: The Classical Model: A Summary
118. Market clearing in the loanable funds market

a. violates Say's Law
b. guarantees that total spending will be just sufficient to purchase whatever output is
produced
c. means that the interest rate never changes
d. guarantees that total spending will equal the quantity of loanable funds demanded
e. requires that the government run a budget deficit
119. According to Say's Law,

a. demand creates its own supply
b. interest rates never change
c. there is never too much or too little spending
d. prices never change
e. the market for loanable funds is always in equilibrium
120. According to the classical model, if the government wanted to increase employment, it could do so by
increasing its own spending. That would lead firms to produce more output, for which they would
need to hire more workers.
a. True
b. False
TOP: Using the Theory: Fiscal Policy in the Classical Model
121. Fiscal policy is a change in either government purchases or the money supply designed to change total
spending in the economy, thereby influencing the levels of employment and output.
a. True
b. False
122. If political influences, independent of any economic forces, lead to a larger government budget deficit,
what will be the effect on the loanable funds market?
a. The interest rate will rise and the amount of saving will increase.
b. The interest rate will fall and the amount of saving will increase.
c. The interest rate will rise and the amount of saving will decrease.
d. The interest rate will fall and the amount of saving will decrease.
e. The interest rate will rise but the change in saving will be ambiguous.
123. Changes in government spending or taxes designed to stimulate the economy are examples of
a. fiscal policy
b. monetary policy
c. supply management policy
d. classical policy
e. regulatory policy
124. If the government increases its spending or reduces its taxes in order to influence the level of economic
activity, it is engaging in
a. regulatory policy
b. antitrust policy
c. monetary policy
d. fiscal policy
e. supply-management policy
125. Refer to Figure 8-6. Suppose that a $1 trillion increase in government spending shifted the demand for
funds curve from D1 to D2. What would happen to the sum of investment and consumption spending?
That sum would
a. remain unchanged
b. rise by $0.6 trillion
c. rise by $1 trillion
d. fall by $1 trillion
e. fall by $0.4 trillion
TOP: Fiscal Policy with a Budget Deficit
126. In the classical model, if government tries to increase employment and output by increasing its own
purchases,
a. it will achieve its goal and economic conditions will improve
b. it will not attain its objective unless it also decreases taxes
c. its actions will cause the interest rate to rise, which will choke off investment spending
d. firms will be motivated to increase their output, thereby creating even more jobs
e. saving will also increase, as more people are employed
127. According to the classical model, an increase in government purchases will

a. lead to a change in the interest rate that encourages consumers to spend more
b. lead to a change in the interest rate that encourages private businesses to invest more
c. discourage private spending by increasing the price level
d. be partially offset by a decline in consumption and investment spending
e. leave total spending and output unchanged
128. Which of the following does not usually occur when there is an increase in government spending?
a. Government purchases crowd out private-sector spending.
b. Total spending decreases.
c. The interest rate increases.
d. Investment spending declines.
e. Household saving increases.
129. Crowding out refers to a(n)

a. decrease in the amount of goods produced after too many goods have crowded onto the
market
b. business tactic used to steal a competitor's customers
c. increase in one sector's spending caused by an increase in another sector's spending
d. decrease in the price level after too many goods have crowded onto the market
e. decline in one sector's spending caused by an increase in another sector's spending
130. A decrease in government spending would cause all but one of the following to happen. Which is the
exception?
a. The government's budget deficit would shrink.
b. The interest rate would decrease.
c. Consumption spending would increase.
d. Investment spending would increase.
e. Total output would decrease.
131. According to the classical model, if the government lowers its budget deficit, which of the following
will occur?
a. The interest rate will rise, and consumption, investment and output will all decrease.
b. The interest rate will fall, consumption and investment will increase, but output will not
change.
c. The interest rate will rise, and consumption, investment and output will all increase.
d. The interest rate will fall, and consumption, investment and output will all increase.
e. The interest rate will fall, consumption will not change, but investment and output will
both increase.
132. Which of the following is an implication of the classical model?

a. The supply of loanable funds curve is downward sloping.
b. The inflation rate is constantly rising.
c. Fiscal policy only changes the amount of consumption, investment and government
spending, not the amount of output produced.
d. Monetary policy can change both the interest rate and real output.
e. The interest rate can only be changed by monetary policy, not by changes in government
spending.
133. When the government is running a budget surplus,

a. the demand for loanable funds includes only business investment spending
b. the supply of loanable funds includes only business investment spending
c. the loanable funds market cannot be in equilibrium
d. the supply of loanable funds includes only household saving
e. there will be an excess supply of loanable funds
TOP: Fiscal Policy with a Budget Surplus
134. In the classical model, beginning from an equilibrium in which the government is running a budget
surplus
a. the supply of loanable funds will be horizontal
b. an increase in government spending will cause the interest rate to rise
c. the supply of loanable funds will be vertical
d. an increase in government spending will crowd out less than an equal amount of private
spending
e. a decrease in government spending will crowd out less than an equal amount of private
spending
surplus,
a. this will lower the wage rate
b. the demand for loanable funds will be horizontal
c. an increase in government spending will crowd out more than an equal amount of private
spending
d. an increase in government spending will crowd out an equal amount of private spending
e. an increase in government spending will crowd out less than an equal amount of private
spending
surplus, an increase in government spending will
a. lower the wage rate
b. increase the supply of loanable funds
c. cause total spending to decline
d. cause total spending to increase
e. leave total spending unchanged
137. Which of the following types of unemployment can the classical model not explain?
a. Structural unemployment
b. Cyclical unemployment
c. Seasonal unemployment
d. Frictional unemployment
e. Temporary unemployment
138. The classical model does a good job of explaining the _____ while doing poor a job of explaining the
_____.
a. short run; long run
b. business cycle; long run
c. short run; business cycle
d. unemployment rate; interest rates
e. long run; short run
139. Which of the following events led to the debate over the applicability of the classical model?
a. World War II
b. World War I
c. Korean War
e. The Great Society
140. Classical economists believed that the economy would always return to full employment.
a. True
b. False
141. Assume that markets clear. If in the labor market there is

a. an excess supply of labor, wages will rise
b. an excess demand for labor, wages will fall
c. an excess demand for labor, wages will rise
d. an excess supply of labor, wages stay constant
e. a decline in labor demand, wages will rise
142. In the classical model, markets clear

a. in the short run
b. every month
c. immediately
d. in the long run
e. as soon as any shock occurs
143. How do people in a market economy obtain income that is used to buy goods and services?
a. Supplying labor and other resources to firms
b. Trading goods and services in a barter system
c. Selling goods and services to each other
d. None of the above
e. b and c
144. Suppose the current equilibrium real wage is $15 an hour. Which of the following is true?
a. A real wage above $15 an hour would lead to an excess demand for labor
b. A real wage above $15 an hour would lead to an excess supply of labor
c. The real wage must fall to prevent unemployment
d. The real wage must rise to prevent unemployment
e. A real wage below $15 an hour would lead to an excess supply of labor
145. Diminishing marginal returns means that aggregate production function is

a. linear
b. downward sloping
c. upward sloping
d. concave
e. convex
146. The aggregate production function shows

a. the total output the economy can produce with different quantities of labor and
technology, holding land and capital constant
b. the total output the economy can produce with different quantities of land and labor,
holding capital and technology constant
c. the total output the economy can produce with different quantities of labor, holding land,
capital and technology constant
d. the total output the economy can produce with different quantities of labor and capital,
holding land and technology constant
e. the total output the economy can produce with different quantities of technology, holding
land, labor and capital constant
147. What condition must be met in order for total spending to equal total output?
a. The sum of saving and government purchases must equal the sum of planned investment
and net taxes.
b. The sum of saving and net taxes must equal the sum of planned investment and
government purchases.
c. The sum of saving and planned investment must equal the sum of government purchases
and net taxes.
d. Saving must equal net taxes.
e. The sum of saving and net taxes must equal planned investment minus government
purchases.
148. Which of the following lists represent leakages from the circular flow?
a. Government purchases, net taxes and household saving.
b. Planned investment, net taxes and government purchases.
c. Household saving and planned investment.
d. Planned investment and net taxes.
e. Household saving and net taxes.
149. Assume the economy is currently in equilibrium. Use the following information to calculate the total
value of injections
Consumption Spending $5 trillion

Total injections are

a. $10.7 trillion
b. $5.1 trillion
c. $5.9 trillion
d. $5.7 trillion
e. $5.3 trillion
150. Which of the following are examples of leakages?

a. government purchases, net taxes and imports
b. government purchases, exports and investment spending
c. net taxes, household saving and imports
d. net taxes, investment spending and exports
e. net exports, investment spending and net taxes
151. Assume a closed economy. If consumption spending is $6.2 trillion, investment spending is $2.5
trillion, net taxes are $1.5 trillion and total income is $11 trillion, how much must government
purchases be?
a. $2.3 trillion
b. $0.8 trillion
c. $3.3 trillion
d. $7 trillion
e. cannot be determined without more information
152. Which of the following are examples of injections?

a. government purchases, net taxes and exports
b. government purchases, investment spending and exports
c. net taxes, imports and household saving
d. household saving, imports and government purchases
e. exports, imports and household saving
153. Which of the following is the formula for the government’s budget deficit?
a. S - G
b. G -T
c. C + I + G
d. S + I
e. I + G
154. In the classical model, the demand for loanable funds comes from
a. consumption expenditures and the government deficit, if any
b. net taxes and government expenditures
c. government purchases
d. investment spending and the government deficit, if any
e. consumption expenditures, investment spending and government purchases
155. The supply of loanable funds curve is downward sloping.

a. True
b. False
156. On a graph, the private sector’s demand for loanable funds curve is
a. upward sloping
b. vertical
c. horizontal
d. downward sloping
e. horizontal then upward sloping
157. The demand for loanable funds curve is downward sloping because
a. as the interest rate falls business firms demand fewer loanable funds
b. as the interest rate falls business firms demand more loanable funds
c. as the interest rate rises business firms demand more loanable funds
d. as the interest rate rises, the government demands more loanable funds
e. as the interest rate rises, the government demands fewer loanable funds
158. In the loanable funds market, if the government is running a deficit

a. it is a supplier of funds as it is taking in more than it is spending
b. it is a demander of funds as it is taking in more than it is spending
c. it is a supplier of funds as it is spending more than it is taking in
d. it is neither be a supplier or demander
e. it is a demander of funds as it is spending more than it is taking in.
159. Refer to Figure 8-7. What is the equilibrium interest rate in the above figure?
a. 6% because that is where the total supply of funds equals the total demand.
b. 5% because business and the government want to borrow as much as possible.
c. 6% because that is where the amount of funds demanded is equal to the amount of funds
demanded.
d. 7% because households refuse to lend enough funds at a lower interest rate.
e. 5% because households refuse to lend enough funds at a higher interest rate.
160. What is the equilibrium condition in the loanable funds market?

a. S + G = IP - T
b. S = IP + T - G
c. S + IP = G - T
d. S - T = IP + G
e. S = IP + G - T
161. Say’s law assures us that in the classical model, total spending is always enough to purchase the
economy’s total output.
a. True
b. False
162. As long as the loanable funds market clears, Say’s law holds..
a. True
b. False
163. Fiscal policy is

a. a change in money supply designed to change total spending.
b. a change in interest rates designed to change total spending.
c. a change in government purchases or net taxes designed to change total spending.
d. a change in government regulations designed to change total spending.
e. a change in policy stance by the Federal Reserve designed to change total spending.
TOP: Fiscal Policy in the Classical Model
164. In the classical model, fiscal policy is both ineffective and unnecessary.
a. True
b. False
165. In the classical model, we assume there is no ongoing inflation, so there is no need to distinguish
between the nominal interest rate and the real interest rate.
a. True
b. False
TOP: The Supply of Loanable Funds
166. Say’s law promises that each and every firm in the economy will be able to sell all of the particular
output it produces.
a. True
b. False
167. What is the concept springs to mind when thinking of the classical model?.
a. Inflation.
b. Population growth.
c. Markets clear.
d. The microeconomy.
e. Money supply.
168. John Maynard Keynes was the author of

a. An Economic History of the Great Depression.
b. The General Theory of Employment, Interest, and Money.
c. The Wealth of Nations.
d. The Principles of Political Economy and Taxation.
e. Macroeconomic Policy.
TOP: The Classical Long-Run Model
169. The terms “long-run view” and “classical view” can be used interchangeably.
a. True
b. False
TOP: Why the Classical Model is Important.
170. The slope of the production function reflects

a. capital expenditures.
b. government expenditures.
c. Constant returns to labor.
d. Increasing returns to labor.
e. Diminishing returns to labor.
LOC: Understanding and applying economic models TOP: The Production Function
171. In the classical model, taxes and spending are treated as two separate variables.
a. True
b. False.
172. In the classical model, government purchases or tax cuts are appropriate policies to raise GDP.
a. True
b. False.
173. In the classical model, we include unintended inventory changes.

a. True
b. False.
174. In the classical model,

a. markets do not automatically clear.
b. business demand for loanable fund exceeds business planned investment spending.
c. business demand for loanable fund is equal to business planned investment spending.
d. businesses engage in interest-free borrowing.
e. the government’s demand for funds is downward sloping.
TOP: The Demand for Loanable Funds
175. In the classical model,

a. markets do not automatically clear.
b. business demand for loanable fund exceeds business planned investment spending.
c. there is no government sector, only private consumption and planned investment.
d. businesses engage in interest-free borrowing.
e. the government’s demand for funds is vertical.
TOP: The Demand for Loanable Funds
176. Household saving is the defined as consumption minus disposable income.

a. True
b. False.
177. When we talk about injections in the classical model, we refer to

a. taxes
b. total government purchases.
c. federal government purchases only.
d. state government purchases only.
e. local government purchases only.
178. In the classical model, the government needs to worry about employment.
a. True
b. False.
179. In the classical model, the government needs to worry about total spending.
a. True
b. False.
180. In the classical model, fiscal policy has no demand-side effects on output or employment..
a. True
b. False.
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of the rest. It was a scene of fiends: but in vain; for though they
appeared ready enough to quarrel and fight amongst themselves,
there was no move to attack the enemy. All was confusion; the
demon of discord and madness was among them, and I was glad to
see them cool down, when the dissentients to the assault proposed
making a round to-night and attacking to-morrow.”
And so this precious game of “if you will I will,” and “you hit me
first,” was continued for many days,—more days indeed than the
reader would guess if he were left to his own judgment. The row
between Subtu and Illudeen took place on the 31st of October, and
on the 18th of the following January the enemy was routed and his
forts destroyed.
One of the most favourite of Dayak war weapons is the
“sumpitan,” a long hollow reed, through which is propelled by the
breath small darts or arrows, chiefly formidable on account of the
poison with which their tips are covered. According to Mundy and
other writers on Bornean manners and customs, the arrows are
contained in a bamboo case hung at the side, and at the bottom of
this quiver is the poison of the upas. The arrow is a piece of wood
sharp-pointed, and inserted in a socket made of the pith of a tree,
which fits the tube of the blow-pipe. The natives carry a small
calabash for these arrow heads, and on going into action prepare a
sufficient number, and fresh dip the points in the poison, as its
deadly influence does not continue long. When they face an enemy
the box at the side is open; and, whether advancing or retreating,
they fire the poisoned missiles with great rapidity and precision:
some hold four spare arrows between the fingers of the hand which
grasps the sumpitan, whilst others take their side case.
In advancing, the sumpitan is carried at the mouth and elevated,
and they will discharge at least five arrows to one compared with a
musket. Beyond a distance of twenty yards they do not shoot with
certainty, from the lightness of the arrow, but on a calm day, the
range may be a hundred yards. The poison is considered deadly by
the Kayans, but the Malays do not agree in this belief. “My own
impression is,” says Captain Mundy, “that the consequences
resulting from a wound are greatly exaggerated, though if the poison
be fresh death may occasionally ensue; but, decidedly, when it has
been exposed for any time to the air it loses its virulence. My servant
was wounded in the foot by an arrow which had been kept about two
months; blood flowed from the puncture, which caused me
considerable alarm; but sulphuric acid being applied in conjunction
with caustic directly afterwards, he felt no bad effects whatever.”
All the tribes who use the sumpitan, from their peculiar mode of
fighting, and the dread of the weapon, are called Nata Hutan, or
“Wood Devils.” Besides the sumpitan they also wear the “ilang,” or
sword, which is carved at the angle in the rude shape of a horse’s
head, and ornamented with tufts of hair, red or black; the blades of
these swords are remarkable, one side being convex, the other
concave. They are usually very short, but of good metal and fine
edge. These warriors wear coats of deer hide, and caps of basket
work, some fantastically decorated; and a shield hung over their
backs of stout wood, in addition to the weapons already mentioned,
forms their equipment for service. It is really curious to witness their
movements when the order is given to go out to skirmish—one by
one, with a quick pace, yet steady and silent tread, they glide into the
bushes or long grass, gain the narrow paths, and gradually
disappear in the thickest jungle.
The chief weapon used by the Amazonian Indians closely
resembles the Dayak sumpitan, and is called “pucuna.” Its
manufacture and use is thus graphically described by Captain Reid:
—
“When the Amazonian Indian wishes to manufacture for himself a
pucuna he goes out into the forest and searches for two tall straight
stems of the ‘pashiuba miri’ palm. These he requires of such
thickness that one can be contained within the other. Having found
what he wants, he cuts both down and carries them home to his
molocca. Neither of them is of such dimensions as to render this
either impossible or difficult. He now takes a long slender rod—
already prepared for the purpose—and with this pushes out the pith
from both stems, just as boys do when preparing their pop-guns from
the stems of the elder-tree. The rod thus used is obtained from
another species of Iriartea palm, of which the wood is very hard and
tough. A little tuft of fern-root, fixed upon the end of the rod, is then
drawn backward and forward through the tubes, until both are
cleared of any pith which may have adhered to the interior; and both
are polished by this process to the smoothness of ivory. The palm of
smaller diameter, being scraped to a proper size, is now inserted into
the tube of the larger, the object being to correct any crookedness in
either, should there be such; and if this does not succeed, both are
whipped to some straight beam or post, and thus left till they become
straight. One end of the bore, from the nature of the tree, is always
smaller than the other; and to this end is fitted a mouthpiece of two
peccary tusks to concentrate the breath of the hunter when blowing
into the tube. The other end is the muzzle; and near this, on the top,
a sight is placed, usually a tooth of the ‘paca’ or some other rodent
animal. This sight is glued on with a gum which another tropic tree
furnishes. Over the outside, when desirous of giving the weapon an
ornamental finish, the maker winds spirally a shining creeper, and
then the pucuna is ready for action.
“Sometimes only a single shank of palm is used, and instead of
the pith being pushed out, the stem is split into two equal parts
throughout its whole extent. The heart substance being then
removed, the two pieces are brought together, like the two divisions
of a cedar-wood pencil, and tightly bound with a sipo.
“The pucuna is usually about an inch and a half in diameter at the
thickest end, and the bore about equal to that of a pistol of ordinary
calibre. In length, however, the weapon varies from eight to twelve
feet.
“This singular instrument is designed, not for propelling a bullet,
but an arrow; but as this arrow differs altogether from the common
kind, it also needs to be described.
“The blow-gun arrow is about fifteen or eighteen inches long, and
is made of a piece of split bamboo; but when the ‘patawa’ palm can
be found, this tree furnishes a still better material, in the long spines
that grow out from the sheathing bases of its leaves. These are
eighteen inches in length, of a black colour, flattish though perfectly
straight. Being cut to the proper length—which most of them are
without cutting—they are whittled at one end to a sharp point. This
point is dipped about three inches deep in the celebrated ‘curare’
poison; and just where the poison mark terminates, a notch is made,
so that the head will be easily broken off when the arrow is in the
wound. Near the other end a little soft down of silky cotton (the floss
of the bombax ceiba) is twisted around into a smooth mass of the
shape of a spinning-top, with its larger end towards the nearer
extremity of the arrow. The cotton is held in its place by being lightly
whipped on by the delicate thread or fibre of a bromelia, and the
mass is just big enough to fill the tube by gently pressing it inward.
“The arrow thus made is inserted, and whenever the game is
within reach the Indian places his mouth to the lower end or
mouthpiece, and with a strong ‘puff,’ which practice enables him to
give, he sends the little messenger upon its deadly errand. He can
hit with unerring aim at the distance of forty or fifty paces; but he
prefers to shoot in a direction nearly vertical, as in that way he can
take the surest aim. As his common game—birds and monkeys—are
usually perched upon the higher branches of tall trees, their situation
just suits him. Of course it is not the mere wound of the arrow that
kills these creatures, but the poison, which in two or three minutes
after they have been hit, will bring either bird or monkey to the
ground. When the latter is struck he would be certain to draw out the
arrow; but the notch, already mentioned, provides against this, as
the slightest wrench serves to break off the envenomed head.
“These arrows are dangerous things—even for the manufacturer
of them—to play with: they are therefore carried in a quiver, and with
great care—the quiver consisting either of a bamboo joint or a neat
wicker case.”
To return, however, to our savage friends the Borneans. Like
almost all savages under the sun, they have their war dances:—
“We had one day a dance of the Illanuns, and Gillolos; they might
both be called war dances, but are very different. The performer with
the Illanuns is decked out with a fine helmet (probably borrowed from
our early voyagers) ornamented with bird-of-paradise feathers. Two
gold belts crossed like our soldiers, over the breast, are bound at the
waist with a fantastical garment reaching half-way down the thigh,
and composed of various coloured silk and woollen threads one
above another. The sword or kempilan is decorated at the handle
with a yard or two of red cloth, and the long upright shield is covered
with small rings, which clash as the performer goes through his
evolutions. The dance itself consists of a variety of violent warlike
gestures; stamping, striking, advancing, retreating, turning, falling,
yelling, with here and there bold stops, and excellent as to aplomb,
which might have elicited the applause of the opera-house; but
generally speaking, the performance was outrageously fierce, and so
far natural as approaching to an actual combat; and in half an hour
the dancer, a fine young man, was so exhausted that he fell fainting
into the arms of his comrades. Several others succeeded, but not
equal to the first, and we had hardly a fair opportunity of judging of
the Maluku dance, from its short continuance; but it is of a more
gentle nature, advancing with the spear, stealthily casting it, then
retreating with the sword and shield. The Maluku shield, it should be
observed, is remarkably narrow, and is brandished somewhat in the
same way as the single-stick player uses his stick, or the Irishman
his shillalah, that is to say, it is held nearly in the centre, and whirled
every way round.”
The following extract from Sir J. Brooke’s Bornean Journal will
serve to initiate the curious reader in the peculiarly horrid custom of
“head-hunting,” as observed in this part of the world. Close to the
Rajah’s residence were located a party of Sigo Dayaks, who happily
discovered in good time an incursion of their deadly enemies the
Singés into their territory:—
“The Sigos taking the alarm, cut off their retreat and killed two of
the Singé Dayaks, and obtained altogether five heads, though they
lost two, and those belonging to their principal warriors. This news
reaching me, I hurried up to the hill and arrived just after part of the
war party had brought the heads. On our ascending the mountain we
found the five heads carefully watched about half a mile from the
town, in consequence of the non-arrival of some of the war party.
They had erected a temporary shed close to the place where these
miserable remnants of noisome mortality were deposited, and they
were guarded by about thirty young men in their finest dresses,
composed principally of scarlet jackets ornamented with shells,
turbans of the native bark cloth dyed bright yellow and spread on the
head, and decked with an occasional feather, flower, or twig of
leaves. Nothing can exceed their partiality for these trophies; and in
retiring from the war path, the man who has been so fortunate as to
obtain a head, hangs it about his neck, and instantly commences his
return to his tribe. If he sleep on the way, the precious burden,
though decaying and offensive, is not loosened, but rests in his lap,
whilst his head (and nose) reclines on his knees.
“On the following morning the heads were brought up to the
village, attended by a number of young men, all dressed in their
best, and were carried to Parembam’s house, amid the beating of
gongs and the firing of one or two guns. They were then disposed of
in a conspicuous place in the public hall of Parembam. The music
sounded, and the men danced the greater part of the day, and
towards evening carried them away in procession through all the
campongs except three or four just above me. The women in these
processions crowd round the heads as they proceed from house to
house, and put sirih and betel-nut in the mouths of the ghastly dead,
and welcome them. After this they are carried back in the same
triumph, deposited in an airy place, and left to dry. During this
process, for seven, eight, and ten days, they are watched by the
boys of the age of six to ten years, and during this time they never
stir from the public hall: they are not permitted to put their foot out of
it whilst engaged in this sacred trust. Thus are the youths initiated.
“For a long time after the heads are hung up, the men nightly
meet and beat their gongs, and chant addresses to them, which
were rendered thus to me. ‘Your head is in our dwelling, but your
spirit wanders to your own country. Your head and your spirit are
now ours; persuade, therefore, your countrymen to be slain by us!
Speak to the spirits of your tribe; let them wander in the fields, that
when we come again to their country we may get more heads, and
that we may bring the heads of your brethren, and hang them by
your head,’ etc. The tone of this chant is loud and monotonous, and I
am not able to say how long it is sung, but certainly for a month after
the arrival of the heads, as one party here had had a head for that
time, and were still exhorting it.
“These are their customs and modes of warfare, and I may
conclude by saying, that though their trophies are more disgusting,
yet their wars are neither so bloody, nor their cruelties so great, as
those of the North American Indian. They slay all they meet with of
their enemies, men, women, and children; but this is common to all
wild tribes. They have an implacable spirit of revenge as long as the
war lasts, retort evil for evil, and retaliate life for life: and as I have
before said, the heads are the trophies, as the scalps are to the red
men. But on the contrary, they never torture their enemies, nor do
they devour them, and peace can always be restored amongst them
by a very moderate payment. In short, there is nothing new in their
feelings or in their mode of showing them, no trait remarkable for
cruelty, no head hunting for the sake of head hunting. They act
precisely on the same impulses as other wild men: war arises from
passion or interest, peace from defeat or fear. As friends they are
faithful, just, and honest; as enemies, bloodthirsty and cunning;
patient on the war path, and enduring fatigue, hunger, and the want
of sleep with cheerfulness and resolution. As woodmen, they are
remarkably acute, and on all their excursions carry with them a
number of ranjows, which, when they retreat, they stick in behind
them at intervals at a distance of twenty, fifty, or a hundred yards, so
that a hotly-pursuing enemy gets checked, and many severely
wounded. Their arms consist of a sword, an iron-headed spear, a
few wooden spears, a knife worn at the right side, with a sirih pouch
or small basket. Their provision is a particular kind of sticky rice
boiled in bamboos. When once they have struck their enemies, or
failed, they return without pausing to their homes.”
Among the Dayaks and the Samoans heads are the precious war
trophies; among the Indians of North America the scalp alone
suffices; the Tinguian of the Philippine Islands, with a refinement of
barbarism far excelling his brother savage, must have his enemy’s
brains. While La Gironiere was sojourning at Palan, one of the
seventeen villages of which Tinguia is composed, news arrived that
a battle had been fought and several renowned warriors captured.
Therefore there was to be a brain feast.
“Towards eleven o’clock the chiefs of the town, followed by all the
population, directed their steps towards the large shed at the end of
the village. There every one took his place on the ground, each party
headed by its chiefs, occupying a place marked out for it beforehand.
In the middle of the circle formed by the chiefs of the warriors were
large vessels full of basi, a beverage made with the fermented juice
of the sugar-cane, and four hideous heads of Guinans entirely
disfigured,—these were the trophies of the victory. When all the
assistants had taken their places, a champion of Laganguilan y
Madalag, took one of the heads and presented it to the chiefs of the
town, who showed it to all the assistants, making a long speech
comprehending many praises for the conquerors. This discourse
being over, the warrior took the head, divided it with strokes of his
hatchet, and took out the brains. During this operation so unpleasant
to witness, another champion got a second head and handed it to
the chiefs; the same speech was delivered, then he broke the skull
to pieces in like manner and took out the brains. The same was done
with the four remaining skulls of the subdued enemies. When the
brains were taken out, the young girls pounded them with their
hands into the vases containing the liquor of the fermented sugar-
cane; they stirred the mixture round, and then the vases were taken
to the chiefs, who dipped in their small osier goblets through the
fissures of which the liquid part ran out, and the solid part that
remained at the bottom they drank with ecstatic sensuality. I felt quite
sick at this scene so entirely new to me. After the chieftains’ turn
came the turn of the champions. The vases were presented to them
and each one sipped with delight this frightful drink, to the noise of
wild songs. There was really something infernal in this sacrifice to
victory.
“We sat in a circle, and these vases were carried round. I well
understood that we were about undergoing a disgusting test. Alas! I
had not long to wait for it. The warriors planted themselves before
me and presented me with the basi and the frightful cup. All eyes
were fixed upon me. The invitation was so direct that to refuse it
would perhaps be exposing myself to death. It is impossible to
describe the interior conflict that passed within me. I would rather
have preferred the carbine of a bandit five paces from my chest, or
await, as I had already done, the impetuous attack of the wild
buffalo. I shall never forget that awful moment; it struck me with
terror and disgust; however, I constrained myself, nothing betraying
my emotion. I imitated the savages, and dipping the osier goblet into
the drink, I approached it to my lips and passed it to the unfortunate
Alila (Gironiere’s servant and companion), who could not avoid this
infernal beverage. The sacrifice was complete, the libations were
over, but not the songs. The basi is a very spirituous and inebriating
liquor, and the assistants who had partaken rather too freely of it
sang louder to the noise of the tom-tom and the gong, while the
champions divided the human skulls into small pieces destined to be
sent as presents to all their friends. The distribution was made during
the sitting, after which the chiefs declared the ceremony over. They
then danced. The savages divided themselves into two lines, and
howling as if they were furious madmen, or terribly provoked, they
jumped about, laying their right hand upon the shoulder of their
partners and changing places with them. These dances continued all
day; at last night came on, each inhabitant repaired with his family
and some few guests to his abode, and soon afterwards tranquillity
was restored.”
In defending the system of warfare practised by the Dayaks,
Rajah Brooke specially instances the thirst for blood and general
cruelty evinced by the savage Indian warrior of North America. Like
other barbarians the North-American Indian has his European and
American champions—Catlin among the latter—who profess to see
in this savage nothing vile or mean or cruel, but, on the contrary, all
that is brave, generous, and hospitable. The said champions,
however, overlook the fact that bravery and generosity as exhibited
amongst one’s friends are but insignificant virtues as compared with
what they are when displayed towards an enemy; indeed, in the
former case they may scarcely be reckoned virtues at all, but merely
social amenities, lacking which, man ceases to be companionable.
As enemies, how do North-American savages treat each other? Let
what has already been said on this subject in these pages, as well
as what here follows, furnish an answer to the question.
CHAPTER XXII.
Wooing a war dream—Companions in arms—The squaw of sacrifice

—On the march—Bragging warriors—Deeds of Indian men of war
—Swallowing an Indian’s horse—The belle of the party—An
instance of Indian heroism—How to serve an enemy—Savage
Duelists—A story of a precious scalp—The Indian warrior’s
confidence in dreams—Concerning Indian canoes—A boat made
up with stitches—Women boat-builders—Samoan warfare—The
Samoans’ war tools and symbols—A narrow escape—“Perhaps
upward the face!”—A massacre of Christians—Treachery of the
Pine Islanders—The fate of “The Sisters”—The scoundrelly
Norfolk Island men—A little story told by Mr. Coulter—The useful
carronades—The “one unnecessary shot”—How it might have
been.
r. Kohl informs us that, when a chief of the North-
American Indians is meditating a war expedition, it is
of the first importance that he should “dream” about it.
He does not, however, choose to wait for his dream in
the ordinary manner, but seats himself for the express purpose,
concentrates his every thought on the subject, and seeks to gain
good dreams for it before he proceeds to carry his war project into
execution.
He keeps apart from his family, and, like a hermit, retires to a
solitary lodge built expressly for the purpose. There he sits whole
evenings on a mat, beating the drum and muttering gloomy magic
songs, which he will break off to sigh and lament. He has all sorts of
apparitions while lying in his bed; the spirits of his relatives murdered
by the enemy visit him, and incite him to revenge. Other spirits come
and show him the way into the enemy’s camp, promise him victory,
tell him at times accurately where and how he will meet the foe and
how many of them he will kill. If his drum and song are heard
frequently in the evenings, a friend will come to him, and sitting down
on the mat by his side will say: “What is the matter with thee, Black
Cloud? Why dreamest thou? What grief is oppressing thee?” The
Black Cloud then opens his heart, tells him how his father’s brother
was scalped three years back by their hereditary enemies, the Sioux,
his cousin last year, and so on, and how thoughts of his forefathers
has now come to him. They have often appeared to him in his
dreams and allowed him no rest with their entreaties for vengeance.
He will tell him, too, a portion of the auguries and signs he has
received in his dream about a brilliant victory he is destined to gain
and of the ways and means that will conduct him to it. Still only a
portion, for he generally keeps the main point to himself. It is his
secret, just as among us the plan of the campaign is the
commander-in-chief’s secret.
The friend, after listening to all this, if the affair seems promising,
will take to the drum in his turn, and aid his friend with his dreams.
The latter, if placing full confidence in him, appoints him his
associate or adjutant, and both place themselves at the head of the
undertaking. They always consider it better that there should be two
leaders, in order that if the dreams of one have not strength enough
the other may help him out.
These two chefs-de-guerre now sit together the whole winter
through, smoke countless pipes, beat the drum in turn, mutter magic
songs the whole night, consult over the plan of operations, and send
tobacco to their friends as an invitation to them to take part in the
campaign. The winter is the season of consultation, for war is rarely
carried on then, partly because the canoe could not be employed on
the frozen lakes, and partly because the snow would betray their trail
and the direction of their march too easily.
If the two are agreed on all points, if they have assembled a
sufficient number of recruits and allies, and have also settled the
time of the foray—for instance, arranged that the affair shall begin
when the leaves are of such a size, or when such a tree is in
blossom, and this time has at length arrived, they first arrange a
universal war dance with their relatives and friends, at which the
women are present, painted black like the men. The squaws appear
at it with dishevelled hair, and with the down of the wild duck strewn
over their heads. A similar war dance is also performed in the lodges
of all the warriors who intend to take part in the expedition.
If the undertaking and the band of braves be at all important, it is
usually accompanied by a maiden, whom they call “the squaw of
sacrifice.” She is ordinarily dressed in white: among the Sioux, for
instance, in a white tanned deer or buffalo robe, and a red cloth is
wrapped round her head. Among several prairie tribes, as the Black-
feet, this festally adorned sacrifice squaw leads a horse by the bridle,
which carries a large medicine-bag, and a gaily decorated pipe.
Among the Ojibbeways, who have no horses, and usually make their
expeditions by water, this maiden is seated in a separate canoe.
When all have taken their places in full war-paint, they begin their
melancholy death-song and push off.
If the expedition is really important—if the leader of the band is
very influential—he will have sent tobacco to other chiefs among his
friends; and if they accept it, and divide it among many of their
partisans, other war bands will have started simultaneously from the
villages, and come together at the place of assembly already
arranged.
They naturally take with them as little as possible, and are mostly
half naked in order to march easily. They do not even burden
themselves with much food, for they starve and fast along the road,
not through any pressure of circumstances, but because this fasting
is more or less a religious war custom.
They also observe all sorts of things along the road, which are in
part most useful, precautionary measures, in part superstitious
customs. Thus, they will never sit down in the shade of a tree, or
scratch their heads, at least not with their fingers. The warriors,
however, are permitted to scratch themselves with a piece of wood
or a comb.
The young men who go on the war trail for the first time, have, like
the women, a cloth or species of cap on the head, and usually walk
with drooping head, speak little, or not at all, and are not allowed to
join in the dead or war songs. Lastly, they are not permitted to suck
the marrow from the bone of any game that is caught and eaten
during the march. There are also numerous matters to be observed
in stepping in and out of the canoes on the war trail. Thus, the foot
must not on any condition be wetted.
The only things they carry with them, besides their arms and
pipes, are their medicine-bags. These they inspect before starting,
as carefully as our soldiers do their cartridge-boxes, and place in
them all the best and most powerful medicines, and all their relics,
magic spells, pieces of paper, etc., in order that the aid of all the
guardian spirits may be ensured them.
The same authority gives us a sample of Indian war dances and
speeches:
“By the afternoon all were ready, and the grand pipe of peace,
they intended to hand to the great father, was properly adorned with
red feathers, blue drawings, strings of wampum, etc.
“It occurred to me that although it was after all but a ceremony, the
Indians regarded the matter very solemnly and earnestly. According
to traditional custom the pipe of peace passed from tent to tent and
from mouth to mouth among the warriors. When each had smoked,
the procession started and marched with drums beating, fluttering
feather-flags and flying-otter, fox, and skunk tails through the village,
to the open space before the old fort of the North West Company.
Here they put up a wooden post, and close to it their war flag, after
which the dances, speeches, and songs began.
“A circle of brown skinned dancers was formed, with the
musicians and singers in the centre. The musicians, a few young
fellows, cowered down on the ground, beat a drum, and shook a
calabash, and some other instruments, which were very primitive.
One had only a board, which he hammered with a big knife, while
holding his hollow hand beneath it as a species of sounding board.
The principal singers were half a dozen women wrapped up in dark
cloaks, who uttered a monotonous and melancholy chant, while
keeping their eyes stedfastly fixed on the ground. The singing
resembled the sound of a storm growling in the distance. To the
music the warriors hopped round in a circle, shaking the otter, fox,
and beaver tails attached to their arms, feet, and heads.
“At times, the singing and dancing were interrupted; adorned with
flying hair and skins, a warrior walked into the circle, raised his
tomahawk, and struck the post a smart blow, as a signal that he was
going to describe his hero deeds. Then he began to narrate in a loud
voice, and very fluently, some horrible story in which he had played
the chief part. He swung the tomahawk, and pointed to the scars and
wounds on his naked body in confirmation of his story, giving the
post a heavy blow now and then. Many had painted their scars a
blood-red colour, and their gesticulations were most striking when
they described the glorious moment of scalping. Although
surrounded by many kind interpreters, who translated all that was
said at once into English or French, I fear it would lead me too far
were I to write down all that was said. Here is a specimen, however:
—
“Many speeches were begun in a humorous fashion. One little
fellow bounded into the circle, and after striking the post, went on,
‘My friends, that I am little you can all see, and I require no witnesses
to that. But to believe that I, little as I am, once killed a giant of a
Sioux, you will need witnesses.’ And then he plucked two witnesses
out of the circle. ‘You and you were present;’ and then he told the
story just as it had occurred. Another with a long rattlesnake’s skin
round his head, and leaning on his lance, told his story objectively,
just as a picture would be described:
“‘Once we Ojibbeways set out against the Sioux. We were one
hundred. One of ours, a courageous man, a man of the right stamp,
impatient for distinction, separated from the others, and crept onward
into the enemy’s country. The man discovered a party of the foe, two
men, two women, and three children. He crept round them like a
wolf, he crawled up to them like a snake, he fell upon them like
lightning, cut down the two men and scalped them. The screaming
women and children he seized by the arm and threw them as
prisoners to his friends who had hastened up at his war yell; and this
lightning, this snake, this wolf, this man, my friends, that was I. I
have spoken.’
North American Weapons.
“In most of the stories told us, however, I could trace very little that
was heroic. Many of them, in fact, appeared a description of the way
in which a cunning wolf attacked and murdered a lamb.
“One of the fellows, with one eye painted white, the other coal-
black, was not ashamed to tell loudly, and with a beaming face, how
he once fell upon a poor solitary Sioux girl and scalped her. He gave
us the minutest details of this atrocity, and yet at the end of his
harangue, he was applauded, or at least behowled, like the other
orators. All the Indians stamped and uttered their war yell as a sign
of applause, by holding their hands to their mouths trumpet fashion.
At the moment the man appeared to me little less ferocious than a
tiger, and yet when I formed his acquaintance at a latter date, he
talked most reasonably and calmly like an honest farmer’s lad. Such
are what are called the contradictions in human nature.
“Very remarkable in all these harangues, was the unconcealed
and vain self-laudation each employed about himself. Every speaker
considered his deed the best and most useful for the whole nation.
Each began by saying that what his predecessors had told them was
very fine, but a trifle when compared with what he had to say about
himself. It was his intention to astonish them once for all. His totem
was the first in the whole land, and the greatest deeds had always
been achieved by the spotted weasels (or as the case may be) and
so he, the younger weasel, not wishing to be the inferior to his
forefathers, had gone forth and performed deeds the description of
which would make their hair stand on end,” etc.
Among other tribes of North-American warriors, the braves were
armed with small tomahawks, or iron hatchets, which they carried
with the powder-horn in the belt on the right side, while the long
tobacco pouch of antelope skin hung by the left side. Over their
shoulders were leather targets, bows and arrows, and some few had
rifles—both weapons were defended from damp in deer-skin cases
—and quivers with the inevitable bead-work, and the fringes which
every savage seems to love.
Speaking of an army of Indian warriors “shifting camp,” Burton
says, in his curious book “The City of the Saints”:—“Their nags were
lean and ungroomed; they treat them as cruelly as do the Somal; yet
nothing short of whiskey can persuade the Indian warrior to part with
a favourite steed. It is his all in all,—his means of livelihood, his
profession, his pride. He is an excellent judge of horse-flesh, though
ignoring the mule and ass; and if he offers an animal for which he
has once refused to trade, it is for the reason that an Oriental takes
to market an adult slave—it has become useless. Like the Arab, he
considers it dishonourable to sell a horse: he gives it to you,
expecting a large present, and if disappointed he goes away
grumbling that you have swallowed his property.
“Behind the warriors and braves followed the baggage of the
village. The lodge-poles in bundles of four or five had been lashed to
pads or packsaddles girthed tight to the ponies’ backs, the other
ends being allowed to trail along the ground like the shafts of a truck.
The sign easily denotes the course of travel. The wolf-like dogs were
also harnessed in the same way; more lupine than canine, they are
ready when hungry to attack man or mule; and sharp-nosed and
prick-eared, they not a little resemble the Indian pariah dog. Their
equipments, however, were of course on a diminutive scale. A little
pad girthed round the barrel with a breastplate to keep it in place,
enabled them to drag two short light lodge-poles tied together at the
smaller extremity. One carried only a hawk on its back; yet falconry
has never, I believe, been practised by the Indian. Behind the ponies
the poles were connected by cross sticks upon which were lashed
the lodge-covers, the buffalo robes, and other bulkier articles. Some
had strong frames of withes or willow basket-work, two branches
being bent into an oval, garnished below with a network of hide-
thongs for a seat, covered with a light wicker canopy, and opening
like a cage only on one side; a blanket or a buffalo robe defends the
inmate from sun and rain. These are the litters for the squaws when
weary, the children and the puppies, which are part of the family till
used for beasts. It might be supposed to be a rough conveyance; the
elasticity of the poles, however, alleviates much of that
inconvenience. A very ancient man, wrinkled as a last year’s walnut,
and apparently crippled by old wounds, was carried probably by his
great-grandsons in a rude sedan. The vehicle was composed of two
pliable poles, about ten feet long, separated by three cross-bars
twenty inches or so apart. In this way the Indians often bear the
wounded back to their villages. Apparently they have never thought
of a horse litter, which might be made with equal facility, and would
certainly save work.
“Whilst the rich squaws rode, the poor followed their pack-horses
on foot, eyeing the more fortunate as the mercer’s wife regards what
she terms the carriage lady. The women’s dress not a little
resembles their lords’—the unaccustomed eye often hesitates
between the sexes. In the fair, however, the waistcoat is absent, the
wide-sleeved skirt extends below the knees, and the leggings are of
somewhat different cut; all wore coarse shawls, or white, blue, or
scarlet cloth-blankets around their bodies. Upon the upper platte, we
afterwards saw them dressed in cotton gowns after a semi-civilized
fashion, and with bowie knives by their sides. The grandmothers
were fearful to look upon; horrid excrescences of nature, teaching
proud man a lesson of humility. The middle aged matrons were
homely bodies, broad and squat like the African dame after she has
become mère de famille; their hands and feet are notably larger from
work than those of the men, and the burdens upon their back caused
them to stoop painfully. The young squaws—pity it is that all our
household Indian words, papoose for instance, tomahawk, wigwam,
and powwow, should have been naturalised out of the Abenaki and
other harsh dialects of New England—deserved a more euphonious
appellation. The belle savage of the party had large and languishing
eyes and teeth that glittered, with sleek long black hair like the ears
of a Blenheim spaniel, justifying a natural instinct to stroke or pat it,
drawn straight over a low broad quadroon-like brow. Her figure had
none of the fragility which distinguishes the higher race, who are
apparently too delicate for human nature’s daily food. Her ears and
neck were laden with tinsel ornaments, brass wire rings adorned her
wrists and fine arms, a bead-work sack encircled her waist, and
scarlet leggings fringed and tasselled, ended in equally costly
mocassins. When addressed by the driver in some terms to me
unintelligible, she replied with a soft clear laugh—the principal charm
of the Indian, as of the smooth-throated African woman—at the
same time showing him the palm of her right hand as though it had
been a looking-glass. The gesture I afterwards learned simply
conveys a refusal. The maidens of the tribe, or those under six, were
charming little creatures with the wildest and most piquant
expression, and the prettiest doll-like features imaginable; the young
coquettes already conferred their smiles as if they had been of any
earthly value. The boys had black beady eyes like snakes, and the
wide mouths of young caymans. Their only dress when they were
not in birthday suit was the Indian laguti. None of the braves carried
scalps, finger-bones, or notches on the lance, which serve like
certain marks on saw-handled pistols further east, nor had any man
lost a limb. They followed us for many a mile, peering into the hinder
part of our travelling wigwam, and ejaculating “How, How,” the
normal salutation.”
Here is an instance at once of Indian warrior heroism on the one
side and fiendish ferocity on the other that occurred at the late
engagement between a small war party of the Chippewas and a
greatly superior party of Sioux, near Cedar Island Lake. The
Chippewas, who were en route for a scalping foray upon the Sioux
villages on the Minnesota, here fell into an ambuscade, and the first
notice of danger which saluted their ears was a discharge of fire-
arms from a thicket. Four of their number fell dead in their tracks.
Another, named the War Cloud, a leading brave, had a leg broken by
a bullet. His comrades were loth to leave him, and, whilst their
assailants were reloading their guns, attempted to carry him along
with them to where they could gain the shelter of a thicket a short
distance to the rear. But he commanded them to leave him, telling
them that he would show his enemies how a Chippewa could die.

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Macroeconomics Principles and

Applications 5th Edition Hall Test Bank

3. According to classical economics,

4. Which of the following is more of a short-run than a long-run goal?

6. The short-run macro model

8. John Maynard Keynes and his followers argued that

9. According to Keynesian economists,

12. The classical model

14. Which of the following is a definition of economic fluctuations?

15. The Classical model

18. A critical assumption in the classical model is that

19. A key assumption of the classical model is that

20. Which of the following is true for a market that clears?

21. The market clearing assumption is

22. Markets clear

24. The desire for goods and services is

25. In the classical long-run model,

26. The classical model

30. The labor supply curve shows

31. The labor demand curve shows the

33. The supply of labor

34. The labor supply curve

35. The labor demand curve slopes

39. Refer to Figure 8-1. If the labor market is in equilibrium, there is no

40. The labor demand curve slopes downward because

43. According to classical economists,

50. The economy's level of output depends upon (1) the

51. The classical model assumes that

53. Which of the following is a definition of the aggregate production function?

54. The aggregate production function is the

59. What is the full-employment output level?

60. An aggregate production function, when shown on a graph,

61. The aggregate production function is the relationship between the

63. According to Say's Law, supply creates its own demand.

64. Say's Law is the idea that

65. Refer to Figure 8-3. This figure is known as

67. Factor payments are

68. According to Say's Law, in the aggregate

70. Say's Law

71. Net taxes are

Consumption Spending $3.5 trillion

Total output for 2008 is

75. What is the relationship between household saving and taxes?

78. Which of the following is a leakages from the circular flow?

Consumption Spending $3.5 trillion

Total leakages are

81. Which of the following is an injection into the circular flow?

82. Leakages are

84. If an economy's consumption spending is $5 trillion, investment is $2 trillion, government spending is

86. Total spending will equal total output

87. Households make their savings available to borrowers through

Consumption Spending $3.5 trillion

The government's deficit (surplus) was

90. The government budget deficit is

92. What is the price of funds in the loanable funds market?

Consumption Spending $3.5 trillion

Consumption Spending $3.5 trillion

96. In the classical model, the quantity of loanable funds supplied is

97. The supply of loanable funds curve

100. Investment spending is inversely related to the interest rate.

101. The investment demand curve

102. In the classical model, investment spending is