Refer to the following graph. The price of labor is $3 per unit: 
What is the marginal rate of technical substitution at point B?
A. 0.75
B. 1
C. 1.7
D. 0.6
Answer: D
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The market demand function for wheat is Qd = 10 - 2P and the market supply function is Qs = 4P - 2, both measured in billions of bushels per year. Suppose the government wants to increase the price of wheat to $3/bushel and they impose a voluntary production reduction program to achieve their goal. What is the size of the aggregate surplus?
A. $4 billion B. $12 billion C. $10 billion D. $6 billion
Suppose MPL = 40 and MPK = 20 and the rental rate on capital is $10 . If the level of production is currently efficient, the wage rate must be
a. $10 b. $5 c. $20 d. $40
During the 1965-2009 period, the price index of healthcare services
a. declined slightly relative to the overall consumer price index. b. fell by approximately 50 percent compared to the overall consumer price index. c. increased at twice the rate of the overall consumer price index. d. rose during a brief period following the passage of Medicare and Medicaid but has been relatively stable since that time.
The logic of the exchange-rate effect begins with a change in the price level changing the interest rate
a. True b. False Indicate whether the statement is true or false