If the marginal product of labor is less than the average product of labor, then the
A. marginal product must be increasing.
B. marginal product must be decreasing.
C. average product must be decreasing.
D. Both B and C
Answer: D
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A good or service or a resource is rival if
A) it is possible to prevent someone from enjoying its benefits. B) it is not possible to prevent someone from enjoying its benefits. C) its use by one person decreases the quantity available for someone else. D) its use by one person does not decrease the quantity available for someone else.
Assume that a firm has $100 million in real assets and $90 in real liabilities. If the price level falls by ten percent, the real value of liabilities would ________
A) fall to $81 million B) change, but more information must be provided to determine the exact movement C) remain unchanged D) rise to $99 million
Assume that business investment spending rises, and the increase is funded by greater borrowing in the capital markets. If the nation has low mobility international capital markets and a fixed exchange rate system, what happens to the GDP Price Index and the nominal value of the domestic currency in the context of the Three-Sector-Model? a. The GDP Price Index rises and nominal value of the
domestic currency falls. b. The GDP Price Index falls and nominal value of the domestic currency rises. c. The GDP Price Index rises and nominal value of the domestic currency remains the same. d. The GDP Price Index rises and nominal value of the domestic currency rises. e. There is not enough information to determine what happens to these two macroeconomic variables.
A pure monopoly is not allocatively efficient because at the profit-maximizing level of output ________.
A. P > MR B. P > AVC C. P > ATC D. P > MC