A firm that knows the market price for its product and its costs can determine how much output that they wish to produce.
Answer the following statement true (T) or false (F)
True
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Alpha has $40,000 of capital per worker, while Beta has $5,000 of capital per worker. In all other respects, the two countries are the same. According to the principle of diminishing returns to capital, an additional unit of capital will increase output ________ in Alpha compared to Beta, holding other factors constant.
A. less B. more C. by the same amount D. not at all
In calculating the net exports component of GDP, exports
a. and imports are subtracted b. and imports are included c. and imports are equal d. are included and imports are not e. are included and imports are subtracted
Another term for equilibrium price is
a. dynamic price. b. market-clearing price. c. quantity-defining price. d. balance price.
One reason that many have not accepted Keynes' views about how the government should respond to economic downturns is that:
A. Keynes' arguments run often counter to popular economic intuition. B. few economists are familiar with Keynes' work. C. the debate has little to no policy relevance. D. no economists believe that economic stimulus measures actually work.