According to Edward Denison, the United States has experienced
a. diseconomies of scale.
b. economies of scale.
c. constant returns to scale.
d. None of the above
B
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A flight to quality refers to a shift by savers from
A) bonds and into stocks. B) stocks and into gold or other precious metals. C) bonds and into real assets, such as real estate. D) low-quality bonds and into high-quality bonds.
Price elasticity of demand is the responsiveness of
A) the quantity demanded to a change in price. B) demand to a change in supply. C) demand to a change in income. D) demand for a good to a change in the demand for another good.
Two Stage Least Squares is calculated as follows; in the first stage:
A) Y is regressed on the exogenous variables only. The predicted value of Y is then regressed on the instrumental variables. B) the unknown coefficients in the reduced form equation are estimated by OLS, and the predicted values are calculated. In the second stage, Y is regressed on these predicted values and the other exogenous variables. C) the exogenous variables are regressed on the instruments. The predicted value of the exogenous variables is then used in the second stage, together with the instruments, to predict the dependent variable. D) the unknown coefficients in the reduced form equation are estimated by weighted least squares, and the predicted values are calculated. In the second stage, Y is regressed on these predicted values and the other exogenous variables.
At price of $1.20, a local pencil manufacturer is willing to supply 150 boxes per day. At a price of $1.40, the manufacturer is willing to supply 170 boxes per day. Using the midpoint method, the price elasticity of supply is about
a. 2.0. b. 1.23. c. 1.00. d. 0.81.