A production possibility frontier that is a line sloping straight down from left to right suggests that:
Answer: The opportunity costs of the products are constant.
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Investments in public infrastructure ________
A) are not subject to diminishing returns B) are a misallocation of national savings C) typically decline during periods of rapid economic growth D) may boost productivity and income
Explain what is meant by economic efficiency. Does efficiency imply that the fastest production processes or the most powerful equipment must always be used? Explain
What will be an ideal response?
Which of the following are qualifications of the Coase Theorem?
a. technical transaction costs must remain low and be unaffected if liability assignment is reversed b. both parties must operate in a purely competitive market c. one party quickly makes an offer the other is just willing to accept only when the information regarding payoffs is complete, certain and known to both parties d. all of the above are correct e. only a and c
What actions could be taken to stabilize output in response to a large decrease in U.S. net exports?
a. increase taxes or increase the money supply b. increase taxes or decrease the money supply c. decrease taxes or increase the money supply d. decrease taxes or decrease the money supply