If labor is a variable input in production, the law of diminishing marginal returns implies that in the short run
A. total product is negative.
B. labor's marginal product decreases after a certain point.
C. total product is negative after a certain point has been reached.
D. labor's marginal product is constant.
Answer: B
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According to the new classical view, when the actual price level is greater than the expected price level
A) aggregate output is above the full employment level. B) aggregate output is below the full employment level. C) the aggregate supply curve will slope downward. D) the coefficient a is equal to zero.
A decrease in the price level in an economy will _____
a. increase the real value of dollar-denominated assets b. shift the aggregate expenditure line downward c. decrease the equilibrium level of output demanded d. cause an upward movement along the aggregate demand curve e. shift the aggregate demand curve leftward
Figure 11-4
Physicians have two types of patients: private patients who pay directly or with insurance, and Medicaid patients whose care is paid for by the state. Physicians must lower prices to attract more private patients, but they can add unlimited Medicaid patients at a constant price. The situation facing Dr. Casey is depicted in Figure 11-4. Units of medical service (say, number of patients × number of visits) are measured on the horizontal axis. How many units of medical service will Dr. Casey deliver?
A. OA B. OB C. OC D. OD
The lowest rating for an investment grade bond assigned by Moody's is:
A. BBB. B. Aa. C. A. D. Baa.