When productive activities are organized according to the principle of the division of labor
A. an inefficient outcome results.
B. scarcity is eliminated.
C. total output increases due to the advantages of specialization.
D. we do not devote enough resources for capital investment.
Answer: C
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An important foundation of the new growth theory is that
A) we will get more technological advances when the rewards for producing them are greater. B) the growth rate of the capital stock is more important than the growth rate of new knowledge in generating economic growth. C) we will get more technological advances the more the government is involved. D) improvements in labor productivity are poor measures of technological growth.
Three individuals consume a public good, and their demands are expressed as:
P1 = 1.5 - 0.005Q (for Q < 300 ); P2 = 4.5 - 0.007Q (for Q < 643 ); P3 = 3.0 - 0.002Q (for Q < 1500 ), where P represents price in dollars per unit and Q represents output in units per day. The marginal cost of providing the service is given as a constant $5.00 per unit. Determine the efficient level of output of this public good.
What is the law of diminishing marginal product? What causes it?
If our economy is growing at a constant rate of 2 percent per year, then over a period of 20 years we would expect to see which of the following?
A. an upward sloping growth path B. nice, steady flat-line growth C. a downward sloping growth path D. It is impossible to say what kind of growth path we would see.