A technology shock could have a different impact than a natural catastrophe because ________
A) the former would likely lower TFP and the latter raise labor productivity
B) the former would likely lower output and the latter raise production
C) the former would likely raise output and the latter would raise TFP
D) the former would likely lower labor productivity and the latter would lower TFP
E) the former would likely raise TFP and the latter would curtail production
E
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Answer the following statement(s) true (T) or false (F)
1. A firm seeks to product at a point where an isocost is tangent to a isoquant. 2. Cost minimization requires that the marginal product of labor equal the marginal product of capital. 3. A point on the firm's expansion path both minimizes the cost of producing a given output level and maximizes the output obtained for a given expenditure level. 4. All points on the expansion path have the same marginal rate of technical substitution. 5. In the long run there is no distinction between average cost and average variable cost.
If the price elasticity of demand is less than 1, a monopoly's
A) total revenue increases when the firm lowers its price. B) total revenue decreases when the firm lowers its price. C) marginal revenue is undefined. D) marginal revenue is zero.
It is ________ difficult to effectively time fiscal policy than monetary policy because ________
A) more; fiscal policy can be quickly decided and changed B) more; fiscal policy takes longer to implement C) less; monetary policy takes longer to implement D) less; monetary policy takes longer to decide and change
Which of the following statements does not apply to a market economy?
a. Firms decide whom to hire and what to produce. b. The "invisible hand" usually maximizes the income of society as a whole. c. Households decide which firms to work for and what to buy with their incomes. d. Government policies are the primary forces that guide the decisions of firms and households.