When the slope of the total product curve is steep, the marginal product is
A) zero.
B) negative.
C) high.
D) low.
E) not defined.
C
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Classical growth theory argues that when real GDP per person rises above the subsistence level
A) technological change slows down, stagnating the economy. B) population growth increases, driving real GDP per person back to subsistence level. C) people don't want to work as much, decreasing labor supply. D) the economy enjoys a period of permanent growth.
When the ________ effect dominates the ________ effect, the labor supply curve is ________
A) income; substitution; vertical B) substitution; income; positively sloped C) income; substitution; negatively sloped D) substitution; income; horizontal
According to the Treaty of Maastricht, a euro applicant must have a total outstanding government debt that does not exceed 60% of its GDP.
a. true b. false
A problem that the Fed faces when it attempts to control the money supply is that
a. since the U.S. has a fractional-reserve banking system, the amount of money in the economy depends in part on the behavior of depositors and bankers.
b. the Fed has to get the approval of the U.S. Treasury Department whenever it uses any of its monetary policy tools.
c. while the Fed has the ability to change the money supply by a large amount, it does not have the ability to change it by a small amount.
d. federal legislation in the 1950s stripped the Fed of its power to act as a lender of last resort to banks.