The concept of opportunity cost is more applicable to society as a whole than it is for an individual household.
Answer the following statement true (T) or false (F)
False
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In the short run, total variable cost
A) includes the cost of capital. B) includes the cost of labor. C) includes both the cost of capital and of labor. D) does not change when production changes. E) is positive when output is zero.
The shape of the production possibilities curve in the figure above indicates that
A) production of corn is characterized by increasing costs while the production of cloth is characterized by decreasing costs. B) production of both corn and cloth is characterized by increasing costs. C) production of both corn and cloth is characterized by constant costs. D) production of corn is characterized by constant costs and the production of cloth is characterized by increasing costs.
If the price of a good rises by 10% and the percentage decrease in the total amount consumers spend on the good is 5%, then the good is
A. inelastic. B. elastic. C. unit elastic. D. perfectly inelastic.
Refer to Table 9.2. (Data are expressed in billions of dollars.)Table 9.2Full Employment Income (Output)Consumers Desire to SpendInvestors Desire to SpendTotal Private SpendingTotal Saving$500$300$250$________$________600375250$________$________700450250$________$________800525250$________$________If the full-employment level of income (YF) in Table 9.2 is $700 billion,
A. There is an inflationary gap of $450 billion. B. There is an inflationary gap of $700 billion. C. The economy is in equilibrium. D. There is a recessionary gap of $250 billion.