Average cost equals total cost multiplied by the number of units of output.
Answer the following statement true (T) or false (F)
False
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Suppose that the Australian economy initially uses 50 billion hours of labor to produce $5 trillion of real GDP. If 50 billion more hours are employed and Australia's real GDP increases by $4 trillion more,
A) Australia's production function exhibits diminishing returns. B) Australia's production function exhibits increasing returns. C) Australia has an Okun Wedge of $1 trillion. D) Australia has positive Lucas Wedge. E) Australia's production possibility frontier has a positive slope.
An expansionary monetary policy will
A. increase imports. B. decrease exports. C. increase a current account deficit. D. decrease a capital account surplus.
Which of the following labor demand curves will be the least elastic?
A. The long-run demand for labor for an elastic product B. The short-run demand for labor of a firm with L-shaped Isoquants C. The short-run demand for labor for an inelastic product D. The long-run demand for labor for an inelastic product
In a binding situation, a decrease in government spending
A. shifts the AD curve to the left. B. does not shift the AD curve. C. causes the AD curve to become horizontal. D. shifts the AD curve to the right.