The difference between the short run and the long run is
A. the short run is a period less than a year while the long run is a period greater than a year.
B. economic and accounting profits are not equal in the short run but are equal in the long run.
C. that in the short run at least one factor of production cannot be varied while in the long run all factors of production can be varied.
D. economic profits are negative in the short run and positive in the long run.
Answer: C
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The rate of economic growth will be faster if
A) the rate of growth of the population is higher. B) consumption spending is greater. C) the rate of saving is higher. D) the rate of growth of the money supply is higher.
If country A is well-endowed with natural resources but a small population while B is endowed with much labor but little land and few natural resources, then trade theory predicts that
a) A and B will not trade with each other, as neither can produce enough goods to export b) A will gain more from trade than B c) The price of labor-intensive goods will fall in country B after trade d) Trade will occur, but wages will fall in country A e) Wages and land values will rise in both countries if they trade
The option holder is:
A. the buyer of an option. B. always a speculator. C. another name for the clearinghouse used in futures contracts. D. the seller of an option.
One should ignore the degree of income inequality _____
a. when one considers the design of redistribution programs b. when one only cares about improving the lot of the worst off in society c. when considering whether or not to transfer resources from the rich to the poor d. when considering progressive taxation