An increase in capital brings a large increase in output at a ________ quantity of capital and a small increase in output at a ________ quantity of capital because of ________
A) large; small; the greater the quantity of capital the greater the output
B) small; large; diminishing returns along the productivity curve
C) large; small; diminishing returns along the productivity curve
D) small; large; increasing returns along the productivity curve
E) large; small; increasing returns along the productivity curve
B
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Refer to Figure 10.7. A movement from point A to point B could be caused by
A) a negative demand shock. B) a decrease in the term premium investors expect in the future. C) an increase in the default-risk premium. D) an increase in the expected rate of inflation.
Which of the following is the best example of the "command" process?
A) United Airlines buys Northwest Airlines. B) Striking auto workers force General Motors to shut down its factories. C) Banks raise their fees on late payments by credit card holders. D) The FCC requires local telephone companies to provide access to their local networks before being able to offer long distance service.
If a firm is operating at a loss in the short run and finds that its price is greater than average variable cost, then in the short run
a. it should produce where MR = MC b. it should produce zero output c. it should go out of business d. total revenue is less than total variable costs e. total revenue is greater than total costs
Which of the following likely occurs when households and firms become more pessimistic?
a. increased spending, increased aggregate demand, rising real GDP, and a rising unemployment rate b. decreased spending, increased aggregate demand, rising real GDP, and a falling unemployment rate c. decreased spending, decreased aggregate demand, falling real GDP, and a rising unemployment rate d. decreased spending, decreased aggregate demand, falling real GDP, and a falling unemployment rate