A technological improvement in the production of good X causes the:
A. demand curve for X to shift to the right.
B. demand curve for X to shift to the left.
C. supply curve for X to shift to the right.
D. supply curve for X to shift to the left.
Answer: C
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In the textbook model of endogenous growth, long-run output growth would decline if there were either a ________ in the saving rate or a ________ in the depreciation rate
A) rise; rise B) rise; fall C) fall; rise D) fall; fall
A positive temporary supply side shock will:
A. increase the level of potential output in the long run. B. decrease the price level in the long run. C. increase the price level in the long run. D. have no effect in the long run.
If the government borrowed funds are invested more in ________ , then it would improve labor productivity and the nation's future standard of living
a. farm subsidies b. retirement benefits c. educated workforce d. defense
If a good is produced by firms that generate external costs, the price consumers pay
A) will be efficient as long as it equals the marginal costs of the firms. B) will be too low. C) will be too high because the consumers end up paying the costs instead of the firm. D) will be the correct price, but the quantity sold of the good will be too large.