Refer to Figure 11-1. Diminishing marginal productivity sets in after
A) the 2nd worker is hired. B) the 3rd worker is hired.
C) the 4th worker is hired. D) the 5th worker is hired.
A
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With respect to economic freedom, which of the following is TRUE?
A) Three out of four people live in nations with governments that grant residents high degrees of economic freedom. B) About three dozen nations with governments unwilling to grant much in the way of economic freedom are home to two-thirds of the world's population. Even so, these countries produce over 50 percent of the world's output. C) Where governments do not grant residents a high degree of economic freedom, economic growth rates tend to be above the annual average for the world's nations. D) As economic freedom increases, so does a nation's prospects for economic growth.
Sue consumes only sandwiches and soda and is at her best affordable point. The price of a sandwich falls. The substitution effect is that Sue substitutes ________ for ________. The income effect is that Sue ________
A) sandwiches; soda; buys less of both goods B) soda; sandwiches; buys more soda and fewer sandwiches C) sandwiches; soda; buys more of both goods D) soda; sandwiches; buys less soda and more sandwiches
In the New Keynesian open economy model, if the exchange rate is fixed
A) fiscal policy and monetary policy are powerless. B) fiscal policy is an effective stabilization tool. C) a change in current total factor productivity increases output. D) monetary policy is an effective stabilization tool.
The aggregate demand of a country is the summation of consumption, investment, government spending, and net exports
a. True b. False Indicate whether the statement is true or false