Suppose our firm produces chartered business flights with capital (planes) and labor (pilots) in fixed proportion (i.e., one pilot for each plane). The expansion path for this business will:
A) increase at a decreasing rate because we will substitute capital for labor as the business grow.
B) follow the 45-degree line from the origin.
C) not be defined.
D) be a vertical line.
B
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Free-market economies have led to
A. high growth rates but low efficiency. B. high efficiency and low growth rates. C. high growth rates and high efficiency. D. low growth rates and low efficiency.
Evaluate the Argentinean Convertibility Law of April, 1991
What will be an ideal response?
By the accelerator hypothesis, if a firm's actual sales jump in one period to a higher maintained level, that firm's gross investment
A) also jumps in one period to a higher maintained level. B) gradually drifts upward to a higher maintained level. C) jumps upward and then falls back to zero. D) jumps upward and then falls back part of the way.
Which of the following is an example of a normative, as opposed to positive, statement?
a. Following the most recent recession, the economy is recovering at a slower than usual pace. b. To stimulate the economy during the most recent recession, the federal government increased spending. c. In response to the most recent recession, the federal government extended the duration of unemployment benefits. d. The federal government's responses to the most recent recession were insufficient.