Cobb-Douglas production functions can never possess varying returns to scale
Indicate whether the statement is true or false
True . The Cobb-Douglas function takes the form q = L?K?, where the exponents are constant parameters. The returns to scale equals ? + ? which is constant for all q.
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If the supply of health care services is highly inelastic, programs that subsidize the cost of purchasing medical services will
a. lead to higher prices for medical services. b. lead to lower prices for medical services. c. not affect the price of medical services. d. help the buyers of medical services more than the sellers of those services.
A bank has a reserve requirement of 0.10. If it has demand deposits of $100,000 and is holding $12,000 in reserves:
A. the bank is holding $2,000 in excess reserves. B. the bank is not meeting its reserve requirement. C. all reserves are required reserves. D. all the bank's reserves are excess reserves.
In the classical theory of employment, a rise in the rate of interest will
A. increase saving and decrease investment. B. decrease saving and increase investment. C. increase saving and investment. D. decrease saving and investment.
The market demand for a product is
A. The sum of all of the marginal utilities among consumers. B. The sum of all of the individual demands for that product. C. The total utility received for a good by all consumers in the market. D. The sum of all of the markets in the area.