In the Keynesian cross diagram, an increase in investment spending because companies become more optimistic about investment profitability causes the aggregate demand function to shift ________, the equilibrium level of aggregate output to rise, and
the IS curve to shift to the ________, everything else held constant. A) up; left
B) up; right
C) down; left
D) down; right
B
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Activities that interest groups undertake to secure special favors from government is called rent seeking
a. True b. False
A private good is:
a. excludable and nonrival. b. nonexcludable and rival. c. nonexcludable and nonrival. d. excludable and rival.
Technological innovation is not subject to diminishing marginal returns because: a. it can be used by workers across the economy at a low marginal cost
b. it can result in a rightward shift of the aggregate production function of an economy. c. it can result in a rightward shift of the production possibilities frontier of an economy. d. it can be used by skilled as well as unskilled workers across the economy.
For a firm, strategic interactions with other firms in the market become more important as the number of firms in the market becomes larger
a. True b. False Indicate whether the statement is true or false