Refer to the information provided in Table 8.1 below to answer the question(s) that follow.
Table 8.1 
Refer to Table 8.1. Assume that the relevant time period is the short run. Assuming the price of labor (L) is $5 per unit and the price of capital (K) is $10 per unit, the average variable cost of producing two units of output is
A. $20.
B. $40.
C. $90.
D. $100.
Answer: C
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a. True b. False
Money markets are where trades occur for:
A. short-term bonds issued by both governments and private companies. B. bonds of all maturities. C. stocks. D. derivatives.
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A. shock to potential output; adverse inflation shock B. shock to potential output; favorable inflation shock C. favorable inflation shock; shock to potential output D. adverse inflation shock; shock to potential output
Holding everything else constant, a decrease in the price of bicycles will result in
A) a decrease in the quantity of bicycles demanded. B) an increase in the demand for bicycles. C) a decrease in the supply of bicycles. D) an increase in the quantity of bicycles demanded.