A sofa manufacturer currently is using 50 workers and 30 machines to produce 5,000 sofas a day. The wage rate is $200 and the rental rate for a machine is $1,000. At these input levels, another worker adds 200 sofas, while another machine adds 500 sofas. If the firm uses 45 workers and 31 machines instead, then its
A. cost will be unchanged, and its output will increase by 300 units.
B. cost will be unchanged, and its output will increase by 500 units.
C. output will be unchanged, and its cost will decrease by $800.
D. cost will be unchanged, and its output will decrease by 500 units.
E. none of the above
Answer: D
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Studies of mutual fund performance indicate that mutual funds that outperformed the market in one time period usually
A) beat the market in the next time period. B) beat the market in the next two subsequent time periods. C) beat the market in the next three subsequent time periods. D) do not beat the market in the next time period.
Assume that taxes are constant. If the government borrows $17 billion in new funds and has a budget deficit of $35 billion, then the central bank has to:
a. reduce the money supply by $52 billion. b. reduce the money supply by $35 billion. c. increase the money supply by $17 billion. d. increase the money supply by $35 billion. e. increase the money supply by $18 billion.
Which of the following is both a supply-side and a fiscal policy tool during a recession?
A. Deregulation. B. Welfare programs. C. Liberalized immigration laws. D. Tax cuts.
Even when a market appears to be a monopoly, it can be contestable if there are many potential entrants.
Answer the following statement true (T) or false (F)