Which of the following ensures full employment in the Classical model?
A) Wage and price flexibility
B) The equation of exchange
C) Inventory adjustment
D) Constant velocity
A
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Other things equal, when the real interest rate falls, C, I and NX ________ and the output gap will ________
A) decrease; decrease B) decrease; increase C) increase; increase D) increase; decrease
Which of the following statements is TRUE?
A) A Cobb-Douglas production function can have different returns to scale at different output levels. B) It is impossible to have increasing returns to scale for one output level, and decreasing returns to scale for a different output level. C) It is possible to have increasing returns to scale for one output level, and decreasing returns to scale for a different output level. D) None of the above.
What is marginal cost?
If a country's saving rate declined, then other things the same, in the long run the country would have
a. lower productivity, but not lower real GDP per person. b. lower productivity and lower real GDP per person. c. lower real GDP per person, but not lower productivity d. neither lower productivity nor lower real GDP per person.