Over the range of positive, but diminishing, marginal returns for an input, the total product curve:
A. Falls
B. Rises at a constant rate
C. Rises at a decreasing rate
D. Rises at an increasing rate
C. Rises at a decreasing rate
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Suppose the value of the CPI is 1.100 in year one, 1.160 in year two, and 1.270 in year three. Assume also that the price of computers increases by 3% between year one and year two, and by another 3% between year two and year three. The price level is increasing, the inflation rate is ________, and the relative price of computers is ________.
A. increasing; decreasing B. constant; increasing C. increasing; increasing D. constant; decreasing
A consumer cannot gain consumer’s surplus if she purchases more than one unit of a good.
Answer the following statement true (T) or false (F)
Differences in growth rates cannot explain why
A. some countries are wealthier than others. B. income inequality exists. C. the convergence hypothesis may hold. D. the productivity growth rates in China and Japan are converging.
Developing countries are damaged by dead capital because
A) it replaces too many workers, creating unemployment. B) resulting inefficiencies greatly reduce the rate of return on investment. C) it must be sold as scrap. D) none of the above.