The capital-labor ratio is the value of the economy's capital stock divided by GDP
Indicate whether the statement is true or false
F
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Suppose that many corporations begin issuing new bonds. Everything else being equal, what is most likely to happen to the interest rate?
a. It will increase. b. It will decrease. c. It will not change. d. It will vary according to a random walk.
Crowding out is most likely to occur when the federal government:
A. Runs a surplus and pays off part of the debt. B. Balances the budget. C. Runs a deficit and raises taxes to generate more revenue. D. Runs a deficit and borrows money to finance its spending.
If inflation is a threat, then the Fed will conduct monetary policy aimed at
A) increasing the interest rate which then will shift aggregate demand to the right. B) decreasing the interest rate which then will shift aggregate demand to the right. C) decreasing the interest rate which then will shift aggregate demand to the left. D) increasing the interest rate which then will shift aggregate demand to theleft.
The consumption schedule shows the relationship of household consumption to the level of:
a. The marginal propensity to consume b. Disposable income c. Investment d. Saving