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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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?
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