Other things the same, a decrease in the price level causes the interest rate to
a. increase, the dollar to appreciate, and net exports to increase.
b. increase, the dollar to depreciate, and net exports to decrease.
c. decrease, the dollar to depreciate, and net exports to increase.
d. decrease, the dollar to appreciate, and net exports to decrease.
c
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According to the principle of diminishing returns, an additional worker decreases total output
Indicate whether the statement is true or false
If a firm wants to maximize profits it should
A) hire lots of capital and very little labor since labor needs to be trained. B) hire unskilled labor rather than skilled labor since unskilled labor is cheaper. C) equate the marginal physical product for each input to the price of the input. D) equate the marginal revenue product for each input to the price of the input.
_____ is contrary to a laissez-faire economic system
a. Active government intervention in all economic decisions b. Reliance on prices to adjust to changing market conditions c. The theory put forward by classical economics d. The theory introduced by neoclassical economics e. The market acting as an invisible hand
The amount of money you should hold depends negatively on the interest rate.
Answer the following statement true (T) or false (F)