Which of the following is true?
a. Cost-reducing automated production techniques will expand output directly and/or release scarce resources for the expansion of output in other areas.
b. Automated production processes are generally adopted regardless of whether they reduce costs.
c. Use of the most advanced technology will always minimize the cost of a productive activity.
d. Automated production processes eliminate jobs and, thereby, endanger our future living standards.
a. Cost-reducing automated production techniques will expand output directly and/or release scarce resources for the expansion of output in other areas.
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The self-correcting tendency of the economy means that rising inflation eventually eliminates:
A. unemployment. B. exogenous spending. C. recessionary gaps. D. expansionary gaps.
Opportunity cost is illustrated in a production possibilities frontier (PPF) by a movement
A) from the region within the PPF to a point on the PPF. B) from the region within the PPF to the region outside of the PPF. C) from the region outside of the PPF to a point on the PPF. D) along the PPF where to gain more of one good it is necessary to give some of another good.
Which of the following changes while moving along the aggregate demand curve?
A) future incomes of households B) the price level C) the amount of money in the economy D) future profits from investment projects
According to the Keynesian IS—LM model, what is the effect of each of the following on output, the real interest rate, employment, and the price level? Distinguish between the short run and the long run
(a) Expected inflation rises. (b) Wealth increases. (c) Labor supply decreases due to a change in demographics. (d) The future marginal product of capital decreases.