A lower equilibrium interest rate:
A. increases saving, reduces total spending, and increases total output.
B. decreases saving, increases total spending, and decreases total output.
C. increases investment, increases total spending, and increases total output.
D. decreases investment, decreases total spending, and increases total output.
Answer: C
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There are fewer workers per retiree today contributing to Social Security than there were in the 1960s
Indicate whether the statement is true or false
Ron regularly deposits $200 each week into a savings account, which earns 3% interest per year. This month he decides instead to invest $200 into the stock market. What is the opportunity cost of Ron's decision to invest rather than save?
A) $200 B) The 3% interest he could have earned by depositing another $200 into his savings account C) The difference between the rate of return he enjoys in the stock market and the 3% interest return he could have earned by depositing that $200 into his savings account D) Zero, because Ron already had the $200
Why can't the government force a natural monopolist to produce the competitive output?
What will be an ideal response?
An increase in output would result in a rise in long-run average costs when there are
A) economies of scale. B) diseconomies to scale. C) constant returns to scale. D) the law of diminishing marginal product.