The marginal rate of technical substitution of labor for capital measures
a. the amount by which capital input can be reduced while holding quantity produced constant when one more unit of labor is used.
b. the amount by which labor input can be reduced while holding quantity produced constant when one more unit of capital is used.
c. the ratio of total labor to total capital.
d. the ratio of total capital to total labor.
a
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Refer to Figure 3-7. Assume that the graphs in this figure represent the demand and supply curves for rice. What happens in this market if buyers expect the price of rice to fall?
A) Panel (a) B) Panel (b) C) Panel (c) D) Panel (d)
Suppose each of the 50 states had only one gasoline station, and all stations were the same size. The four-firm concentration ratio, based on national data, would be:
A. 0.32. B. 1.0. C. 0.16. D. 0.08.
If China decides to enact laws to clean up the environment, what would be the effect on GDP?
A) GDP would increase as the environmental costs of pollution were not included in the calculation of GDP. B) GDP would decrease if the pollution controls reduce productivity by more than the cost of the controls. C) GDP would increase as the citizens of China were made happier as the environment was cleaned up. D) GDP would increase reflecting the fact that the environment would be cleaner.
Under the pollution rights approach, polluters have little or no incentive to develop improved pollution abatement technologies
a. True b. False Indicate whether the statement is true or false