Explain the meaning of the term dead capital, and discuss why its existence retards economic growth.
What will be an ideal response?
Dead capital means a capital resource without a clearly defined owner. Although dead capital is often used in production, the lack of clearly defined title of ownership typically leads to inefficient use of the resource. The inefficient use of dead capital reduces the rate of return on investments and thus the incentive to increase investment in capital goods are reduced. Lower levels of capital investment diminish the rate of economic growth.
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Surplus value that is lost due to taxes imposed on imported goods which are keeping the market from functioning as well as it can is called
A) the loss of subsidy. B) the net export deficit. C) rent seeking loss. D) the deadweight loss of a tariff.
The poverty line in the United States
A. last changed in 1980. B. never changes. C. changes with the level of inflation and family size. D. changes with the minimum wage.
when the money supply is expanding rapidly and the general level of prices increasing sharply economic growth is
What will be an ideal response?
Which of the following reasons promoted lending to the poorer member countries in the European Union during 2001-2007?
A. The investment in human capital in the poorer countries was higher than the investment in the richer countries. B. The long-term interest rates in the poorer countries were as low as the interest rates in the richer member countries. C. The debt to GDP ratio was much lower in the poorer countries than in the richer countries. D. The poorer countries experienced lower rates of inflation than the richer countries.