Refer to Figure 24-2. Ceteris paribus, a decrease in the capital stock would be represented by a movement from
A) SRAS1 to SRAS2. B) SRAS2 to SRAS1. C) point A to point B. D) point B to point A.
B
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A country has an aggregate production function of the form: Y = A x K1/3 x H2/3
Which of the following is likely to happen if the capital stock and the efficiency units of labor available to the country increases by 10% over a span of 5 years while the state of technology used in the country remains the same? A) Output will increase by 5%. B) Output will double. C) Output will increase by 10%. D) Output will increase by 1%.
In a market with positive externalities, the market equilibrium price will be greater than the efficient equilibrium price
Indicate whether the statement is true or false
Refer to Figure 8.4. Up to Point A A) marginal costs are decreasing. B) marginal costs are increasing. C) average variable costs are decreasing. D) average variable costs are increasing.
Assume a competitive market has firms earning large economic profits. What is expected to happen over time in this competitive market and to firm's profits?
What will be an ideal response?