Refer to the information provided in Figure 7.8 below to answer the question(s) that follow. 
Figure 7.8Refer to Figure 7.8. If the price of capital is $25, then along isocost line AB total cost is
A. $1,200.
B. $1,500.
C. $2,000.
D. indeterminate from this information since the price of labor is not given.
Answer: B
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The global financial panic in September 2008 that led to a sharp fall in business investment spending and consumer spending can be viewed as: a. a sharp decrease in aggregate supply
b. a sharp decrease in aggregate demand. c. a sharp decrease in both aggregate supply and aggregate demand. d. a modest increase in aggregate supply. e. a modest increase in both aggregate demand and aggregate supply.
A production function may exhibit
a. constant returns to scale and diminishing marginal productivities to all inputs. b. constant returns to scale and diminishing marginal productivities to all but one input, but at least one input must have a constant marginal productivity. c. constant returns to scale and diminishing marginal productivity to at most one input. d. constant returns to scale and diminishing marginal productivities for no inputs.
The adoption of modern technologies and business methods have the possibility to improve economic performance in a nation with low per capita income and low growth, but only if
a. its natural resources are sufficient. b. its workers become educated rapidly enough. c. it improves its institutions, making them sound enough to attract capital and entrepreneurial activity. d. its government has enough skilled planners to properly deploy new capital.
During the 1990s, the country of Chile required foreigners wishing to invest in the country to make a one-year, zero-interest deposit in the Chilean central bank equal to at least 20 percent of the investment. This is an example of:
A. a capital outflow control. B. a currency board. C. a capital inflow control. D. an exchange rate mechanism.