The law of diminishing marginal returns implies that, in the short run:
A. output must fall beyond a certain point.
B. price must fall beyond a certain point.
C. the marginal product of the variable input must eventually decrease.
D. wages of workers must eventually increase.
Answer: C
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The Social Security program is like a private pension plan in that _____
a. it is a pay-as-you-go system b. it is voluntary c. benefits are a function of earlier contributions d. you have a legal right to your benefits
Suppose Lily's indifference curves are defined as U = ?FS + ?FH, where FS is consumption during sunny weather and FH is consumption during a hurricane. Lily receives 64 units of food when it is sunny and 16 units of food when there is a hurricane. What is the certainty equivalent of the expected food consumption bundle if the probability of sunshine is ? = 0.5?
A. 6 B. 12 C. 25 D. 36
If the Fed raises the legal reserve requirement to 40 percent, and if the total money supply is at its maximum and is $750, the initial deposit must have been
a. $40 b. $250 c. $300 d. $450 e. $1,875
M1 = 1,000 Small denomination time deposits = 1,500 Savings deposit = 1,800 Money market mutual funds = 300 Large denomination time deposits = 800 If M3 is 5,000, small denomination time deposits are 700, and large denomination time deposits are 900, how much is M2?
What will be an ideal response?