Total capital is the sum of
What will be an ideal response?
physical capital and human capital.
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If firms and workers have rational expectations, including knowledge of the policy being used by the Federal Reserve
A) expansionary monetary policy is ineffective. B) expansionary monetary policy is effective in the short run, but not the long run. C) expansionary monetary policy is effective in the short run and the long run. D) expansionary monetary policy is especially effective.
Which of the following would not be considered a role of the government?
a. promoting competition b. providing public goods c. providing externalities d. regulating natural monopolies e. safeguarding private property and enforcing contracts
It is efficient to increase the output of computers if
a. society considers the extra computers more valuable than other goods foregone to produce the computers. b. the opportunity cost of more computers is greater than their marginal utility. c. computer production can be increased only if production of other goods is decreased. d. the price of the computers is equal to their average cost.
An indexed equity mutual fund
a. is directly tied to either the consumer price index or the GDP deflator. b. is a fund that hires a manager who will try to pick the stocks that will increase most in value in the future. c. merely holds stocks in the same proportion as they exist in a broad stock market index like the Standard & Poor's 500. d. will have high operating costs because these funds engage in a substantial amount of stock trading.