During the "computer revolution" of the 1980s and 1990s, many firms replaced old technology with new technology. What might explain why firms don't change technology as quickly today?
What will be an ideal response?
The marginal rate of technical substitution of old technology for new technology was low in the past, but the marginal rate of technical substitution of new technology for newer technology is higher today.
You might also like to view...
Starting from long-run equilibrium, a large tax increase will result in a(n) ________ gap in the short-run and ________ inflation and ________ output in the long-run.
A. recessionary; lower; potential B. expansionary; lower; potential C. expansionary; higher; potential D. recessionary; lower; lower
The present value of a sum of money to be received in future is high if ________
A) the money is invested for a long period of time B) the market rate of interest is low C) the rate of inflation is high D) the future payment is low
When the price of ice cream rises from $3 to $5 a scoop, the quantity of ice cream bought decreases by 10 percent. The price elasticity of demand for ice cream is _______
A. 5 B. 0.2 C. 50 D. 2.5
________ start new economic enterprises, while ________ run the enterprises on a day-to-day basis.
A. Entrepreneurs; laborers B. Mangers; entrepreneurs C. Entrepreneurs; managers D. Mangers; laborers