If the production technology in a Robinson Crusoe economy has increasing returns to scale, there is not competitive equilibrium.
Answer the following statement true (T) or false (F)
True
Rationale:
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If the reserve ratio is 4 percent, the money multiplier is equal to 25
Indicate whether the statement is true or false
If productivity growth in Japan exceeds productivity growth in the U.S., to the point that the resource cost in ALL Japanese industries is lower than in the U.S., then
A. there is no feasible way for the U.S. and Japan to continue to trade. B. mutually beneficial trade is possible. C. trade between the U.S. and Japan is possible, but only Japan will benefit from it. D. trade between the U.S. and Japan is possible, but only the U.S. will benefit from it.
An important problem with corporations is
A) the inability of the government to control and tax the firms. B) the possibility of large liabilities for the owners. C) the separation of ownership and control. D) the difficulties with raising financial capital.
Which of the following is true?
i. A rational choice is made on the margin. ii. Microeconomics is the study of the national economy while macroeconomics is the study of the global economy. iii. Economists try to understand how the economic world works by testing normative statements. A) only i B) i and iii C) only ii D) only iii E) i and ii