To determine the change in the capital stock, the level of new investment must be adjusted for depreciation because some new investment:
A. is not used immediately.
B. merely replaces existing, but worn out, capital.
C. replaces existing workers.
D. is more efficient than existing capital.
Answer: B
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Assume that the full-employment level of output is $1,000 and the price level associated with full-employment output is 100. Also assume that the economy's current level of output is $1,100 and, at the price level of 100, current aggregate demand is $1,200. If the government moves the economy back to the full-employment level of output by reducing government purchases by $50, then the expenditures multiplier equals
A. 4. B. 5. C. 2. D. 10.
The table above shows the labor demand and labor supply schedules for a nation. The equilibrium real wage rate is ________ and the equilibrium quantity of labor is ________ billions of hours per year
A) $25; 260 B) $20; 280 C) $20; 260 D) $15; 260 E) $40; 320
The idea of a carbon tax makes more sense at the _________ level because it is ____________.
A. individual; easier to monitor B. individual; going to have a larger impact C. corporate; going to have a larger impact D. corporate; easier to monitor
A negative value for the marginal physical product would indicate that
A. total output increased by a significant amount. B. total output decreased when the extra unit of the variable input was added. C. the company has not yet reached the point of saturation. D. total output increased, but the increase was very small.