Studies of the high growth Asian economies confirm the importance of savings and investment in increasing economic growth
Indicate whether the statement is true or false
TRUE
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New Keynesians would agree with all of the following except
a. stabilization policy can reduce the severity of business cycles. b. wages and prices are sticky. c. markets are perfectly competitive. d. market equilibrium is often suboptimal.
Suppose price increases from $9.00 to $11.00. Using the mid-point formula, the percentage change in price is:
A. 20% B. 25% C. 20% D. 2%
Adam Smith's invisible hand principle stresses the tendency of
a. self-interested individuals to pursue activities that benefit themselves, but harm the overall economic welfare of society. b. compassion to encourage productive economic activity. c. government regulation to bring the self interest of individuals into harmony with the economic welfare of society. d. the competitive market process to direct self-interested individuals into activities that enhance the economic welfare of society.
When average costs of production are falling, average cost:
a. is higher than marginal cost. b. is equal to price. c. is negative. d. is less than marginal cost.