Probably the most important source of efficiency in production is
a. investing in more capital goods.
b. consuming rationally.
c. expanding the production possibilities frontier.
d. increasing inputs of energy and raw materials.
e. the specialization of labor.
e
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If the economy is falling below potential real GDP, which of the following would be an appropriate fiscal policy to bring the economy back to long-run aggregate supply? An increase in
A) government purchases. B) the money supply and a decrease in interest rates. C) taxes. D) oil prices.
Average variable cost is
a. total cost minus fixed cost b. total variable cost divided by the quantity of output c. total cost plus marginal cost d. total cost per unit of output e. output divided by the quantity of inputs used
Which of the following is included in GDP?
a. The imputed rental value of a family-owned home b. The sale prices of all previously built homes c. Social security payments to retirees d. The salary of a U.S. scientist working in a foreign country e. Purchases of stocks and bonds
Assume that the central bank lowers the discount to increase the nation's monetary base. If the nation has highly mobile international capital markets and a fixed exchange rate system, what happens to the real exchange rate and monetary base in the context of the Three-Sector-Model? State your answer after the macroeconomic system returns to complete equilibrium. Assume the nominal exchange rate
is stated as: (Domestic currency per foreign currency). a. The real exchange rate rises and monetary base rises. b. The real exchange rate rises and monetary base falls. c. The real exchange rate and monetary base fall. d. The real exchange rate and monetary base remain the same. e. There is not enough information to determine what happens to these two macroeconomic variables.