Technological improvements are more likely to occur if
A) the economy is centrally planned.
B) economic decisions are made by politicians rather than entrepreneurs.
C) entrepreneurs are compensated with higher profits for taking risks.
D) companies face little competition in their markets.
C
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A positive value for the cross elasticity of demand between two good implies that these two goods are substitutes.
Answer the following statement true (T) or false (F)
Table 7-5 Stereos produced 0 1 2 3 4 5 6 Total cost (in $) 200 325 410 475 550 660 825 Table 7-5 shows short-run total cost figures for a stereo manufacturer. The manufacturer’s short-run fixed cost is
A. 0. B. $75. C. $200. D. $400.
The number of highly skilled and knowledge workers entering the workforce increases when
(a) firms substitute capital for high priced labor. (b) the market demands labor with advanced degrees. (c) the government cuts educational funding. (d) All of the above
Answer the following statements true (T) or false (F)
1. National income accountants eliminate double counting of intermediate goods by using only the value of final goods. 2. Current disposable income can be adjusted for price changes and population changes to yield real per capita disposable income. 3. A transfer payment is a payment of money in return for which no current goods or services are produced. 4. The value of leisure is not taken into consideration in GDP accounting. 5. When final sales are less than GDP, a net reduction in inventory has taken place.