Small differences in annual growth rates of real GDP generate large differences in real GDP over time because of the:
A. diminishing returns to capital.
B. importance of average labor productivity.
C. limits of economic growth.
D. power of compound interest.
Answer: D
You might also like to view...
Which of the following is NOT a characteristic of a corporation?
A) limited liability for shareholders B) double taxation C) separation of ownership problems D) limited ability to raise capital funds
The Cambridge k is all of the following except
A) the reciprocal of the income velocity of money. B) a transactions demand for money. C) the fraction of GDP that people wish to hold in the form of money balances. D) the velocity of money.
Assume that in a price-fixing game, if Player A breaks the agreement in the first year, she earns $11 while Player B earns $5 . However, if Player A breaks the agreement once, Player B decides to break the agreement for eternity, leaving each to receive $8 per year for the rest of their lives. If they both keep the agreement each receives $9 per year for the rest of their life. If the discount
rate is 120 percent per period: a. Player A will prefer to break the agreement in the first year. b. Player A will prefer to break the agreement in the second year. c. Player A will prefer to keep the agreement throughout her life. d. Player A will prefer to keep the agreement only for the first five years.
If a large number of skilled workers retire at about the same time through early retirements or buyouts, what will happen to the wages of skilled workers, other things being equal?