If a larger fraction of GDP is devoted to ___________, nation’s capital stock will grow faster and the aggregate supply curve will shift more quickly to the right, accelerating growth.
A. investments
B. consumption
C. trade
D. none of these
Answer: A
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You explain to your friend Haslina, who runs a catering service called "Meals in a Zip," about an economic theory which asserts that consumers will purchase less of a product at higher prices than they will at lower prices
She contends that the theory is incorrect because over the past two years she has raised the price of her catered meals and yet has seen a brisk increase in sales. How would you respond to Haslina? A) Haslina is making the mistake of assuming that correlation implies causation. B) I will explain to her that there are some omitted variables that have contributed to an increase in her sales such as changes in income. C) I will explain to her that she is making the error of reverse causality: it is the increase in demand that has enabled her to raise her prices. D) Haslina is right; she has evidence to back her claim. The theory must be erroneous.
Self- reinforcing mechanisms that cause the poor to stay poor are called:
A. social aberrances. B. social networks. C. poverty traps. D. societal traps.
Total variable costs: a. are costs associated with short-run fixed capital
b. are so named because they vary from firm to firm within an industry. c. increase as production increases. d. decrease as production increases.
Use the following graph of the market for milk to answer the question below.
If 30 million gallons of milk are being produced, then we know
A. too much milk is being produced. B. too little milk is being produced. C. marginal benefit is $1.00. D. marginal benefit is greater than marginal cost.