As a firm hires more labor in the short run, the
A) level of total product stays constant.
B) output per worker rises.
C) extra output of an additional worker may rise at first, but eventually must fall.
D) costs of production are increasing at a fixed rate per unit of output.
Answer: C
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?Kites /hourSnowboards /hourJesse81April123
Consider two individuals, Jesse and April, who hand paint kites and snowboards. Table 3.1 shows how much of each good Jesse and April can paint in one hour. Jesse's opportunity cost of painting one snowboard is painting:
A. 1/8 of a kite. B. 1.5 kites. C. 8 kites. D. 12 kites.
A set of actions that a firm takes to achieve a goal is the definition of a
A) business prospectus. B) business strategy. C) business goal. D) business plan.
Suppose the Fed sells $100 million of U.S. securities to the public. If the reserve requirement is 20 percent, the currency holdings of the public are unchanged, and banks have zero excess reserves both before and after the transaction, the total impact on the money supply will be a
a. $100 million decrease. b. $500 million increase. c. $500 million decrease. d. $100 million increase.
For a country with flexible exchange rates, if a nation's interest rate rose, what effect would this have on its current account balance?
a. No effect because interest has no effect on the current account. b. Increase it because foreign capital flows would be attracted to the nation thereby building economic strength. c. Decrease it because the exchange rate will appreciate. d. Increase it because the exchange rate will depreciate. e. Decrease because the exchange rate will depreciate.