Which of the following is true of investment spending in the U.S. economy?
a. Investment spending in 2009 was higher than in 2006.
b. Investment spending was almost double of household spending.
c. Businesses had reduced expenditures on capital goods in 2008 and 2009.
d. Investment spending exhibited a more or less steady increase between 1959 and 2009.
e. Investment spending fluctuated relatively less than consumption.
c
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The market where borrowers obtain funds from savers is referred to as the:
A) capital market. B) exchange market. C) spot market. D) credit market.
Diminishing marginal returns to labor occur because
A) after a while it is hard to find a good worker. B) the capital resources used by the firm are fixed in the short run. C) workers become more efficient over time. D) larger companies are less efficient.
Liquidity preference refers to
A) Keynes' name for the demand for money. B) the "random walk" behavior of consumption spending. C) monetarists explanations for stagflation. D) real business cycle theorists' explanations for stagflation. E) the controversy sparked by the Lucas critique.
Refer to the information provided in Figure 2.5 below to answer the question(s) that follow.
Figure 2.5Refer to Figure 2.5. The economy is currently at Point A. The opportunity cost of moving from Point A to Point B is the
A. 30 LCD televisions that must be forgone to produce 60 additional OLED televisions. B. 90 LCD televisions that must be forgone to produce 20 additional OLED televisions. C. 30 LCD televisions that must be forgone to produce 20 additional OLED televisions. D. 120 LCD televisions that must be forgone to produce 40 additional OLED televisions.