The relationship between the quantity of inputs and the quantity of output is called the:
A. law of diminishing returns.
B. average product.
C. marginal product.
D. production function.
Answer: D
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Given the expected rate of return on all possible investment opportunities in the economy, a(n)
A. change in the real interest rate will have no impact on the level of investment. B. increase in the real rate of interest will tend to increase the level of investment. C. decrease in the real rate of interest will tend to decrease the level of investment. D. decrease in the real rate of interest will tend to increase the level of investment.
Compared to the initial equilibrium, an initial increase in aggregate demand that is NOT followed by an increase in the quantity of money results in new long-run equilibrium with
A) a higher price level but the same real GDP. B) a higher price level and an increased level of real GDP. C) the same price level and a lower level of real GDP. D) the same price level and the same real GDP. E) None of the above answers is correct.
The more elastic the demand for a good, the
A) less a sales tax lowers the price paid by buyers. B) more a sales tax lowers the price paid by buyers. C) less a sales tax raises the price paid by buyers. D) more a sales tax raises the price paid by buyers.
The demand curve for a monopolistic competitor slopes downward because: a. quantity demanded drops to zero after a slight price increase
b. there are close, but not perfect, substitutes for the product. c. customers have no loyalty to the product. d. the product is not differentiated in any way from those offered by other sellers.