Which of the following statements is true about the total product curve?
a. If input usage expands uniformly throughout the stages of production, then the slope of the total product curve is one.
b. The total product curve is inverted U-shaped.
c. As input usage gradually expands from low levels, total output begins to rise at an increasing pace.
d. If the use of inputs is too high at the initial stage of production, then the total prod-uct curve becomes horizontal.
C
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During October and November 2008, gasoline prices were falling dramatically making travel by car less expensive but air travel prices were as high as ever
If travel by car is less expensive, and income remains the same, describe the substitution and income effects that occur for travelling by car. A) If travelling by car is a normal good, the substitution effect would cause an increase and the income effect would cause a decrease in travelling by car. B) If travelling by car is a normal good, both the substitution and income effects would be cause an increase in travelling by car. C) If travelling by car is a normal good, the substitution effect would cause a decrease and the income effect would cause an increase in travelling by car. D) If travelling by car is a normal good, both the substitution and income effects would cause a decrease in travelling by car.
The euro is
A) the currency of all nations in Europe. B) the rate at which the French central bank makes discount loans. C) a common currency of many European countries. D) the name of the European central bank.
The U.S. government budget was
A) continuously in surplus from 1959 to the late 1990s. B) in surplus for most of the period from 1959-1970, but was in deficit for most of the period from 1970 to the late 1990s. C) in deficit for most of the period from 1959-1970, but was in surplus for most of the period from 1970 to the late 1990s. D) continuously in deficit from 1959 to the late 1990s.
If interest rates are to remain constant, the money supply should change: a. in the opposite direction to a change in aggregate demand. b. in the same direction as a change in money demand
c. only when investment changes. d. only when the demand for money decreases. e. only when the inflation rate changes.