If the economy is at macroeconomic equilibrium, then real GDP
A) must equal potential GDP.
B) must be less than potential GDP.
C) must be great than potential GDP.
D) might be equal to, greater than, or less than potential GDP.
E) cannot be compared to potential GDP.
D
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A wage tax in a labor market with a perfectly inelastic labor supply curve is efficient.
Answer the following statement true (T) or false (F)
A firm should increase its investment as long as:
a. marginal resource cost exceeds the interest rate. b. marginal resource cost exceeds marginal revenue product. c. marginal rate of return on investment exceeds the interest rate. d. the interest exceeds the marginal rate of return on investment.
The table below shows the number of labor hours required to produce one umbrella and one bushel of corn in the United Kingdom and the rest of the world. Which of the following statements is true? Labor hours to make:In the United KingdomIn the Rest of the World1 umbrella3.002.001 bushel of corn1.000.25
A. The United Kingdom has a comparative advantage in the production of corn. B. The United Kingdom has a comparative advantage in the production of umbrellas. C. The United Kingdom has a comparative advantage in the production of both goods. D. The United Kingdom has an absolute advantage in the production of umbrellas.
Refer to the above graphs. Pizza and beer are the only two goods Jon consumes. The price of beer is $2.00 per pitcher and pizza is $1.25 per slice. If Jon has only $10 to spend for the evening, which graph represents the set of possible combinations of beer and pizza he can consume?
A. Graph A B. Graph B C. Graph C D. Graph D