Starting from long-run equilibrium, an increase in autonomous investment results in ________ output in the short run and ________ output in the long run.
A. lower; potential
B. higher; higher
C. lower; higher
D. higher; potential
Answer: D
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The matching function exhibits all of the following properties except
A) diminishing marginal product of labor. B) constant returns to scale. C) increasing in matching efficiency. D) increasing in inputs of searching consumers and firms.
Refer to Figure 3-1. A decrease in the price of the product would be represented by a movement from
A) A to B. B) B to A. C) D1 to D2. D) D2 to D1.
Economic reasoning is based on the premise that:
a. all decisions or actions are costless. b. only non-economic decisions or actions have a cost associated with them. c. only economic decisions or actions have a cost associated with them. d. all decisions and actions have a cost associated with them.
Suppose that in a month the price of a cup of coffee increases from $1 to $1.50. At the same time, the quantity of cups of coffee demanded decreases from 200 to 190. The price elasticity of demand for cups of coffee (calculated using the midpoint formula) is approximately:
A. 0.13. B. 0.5. C. 7.8. D. 20.