Suppose that the production function is Y = AK0.7L0.3, the number of workers equals 800, the capital stock is $150,000, and total factor productivity is 3
What is the value of real GDP? What will happen to real GDP if total factor productivity doubles?
Y = AK0.7L0.3 = 3 ($150,000)0.7 × (800)0.3 = $93,607.82. If total factor productivity doubles, GDP will also double, and will equal $187,215.64
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If Ben values good X more than good Y, and Catherine values good Y more than good X, a firm can increase its profits by
A) charging the same price for both goods. B) bundling the goods. C) selling the goods in a competitive market. D) charging one price per good.
This table represents the revenues faced by a monopolist.PriceQuantity SoldTotal RevenueAverage RevenueMarginal Revenue$1,0001$1,000 $9002$1,800 $8003$2,400 $7004$2,800 $6005$3,000 $5006$3,000 $4007$2,800 Using the information in the table shown, the average revenue for this firm:
A. increases as output increases. B. remains constant regardless of level of output. C. decreases as output increases. D. is maximized when total revenue is maximized.
Checking account deposits are included in
A. lines of credit. B. currency. C. M1. D. money market account.
Refer to Figure 3-7. Assume that the graphs in this figure represent the demand and supply curves for frozen yogurt. Which panel describes what happens in the market for frozen yogurt when the price of ice cream, a substitute product, increases?
A) Panel (a) B) Panel (b) C) Panel (c) D) Panel (d)