(Appendix) In the production function Q = 10L1/2K1/2, if the inputs are quadrupled, are there economies of scale? 
.
What will be an ideal response?
There are constant returns to scale, so there are not increasing returns to scale.
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A. decreasing; increases; increases B. decreasing; decreases; decreases C. increasing; decreases; decreases D. increasing; increases; decreases
In response to already low short-term interest rates doing little to stimulate the economy during the Great Recession, the Fed began purchasing mortgage-backed securities and long-term government bonds to bring down long-term interest rates
This policy was called A) closed market operations. B) contractionary monetary policy. C) inflation targeting. D) quantitative easing.
Because of automatic stabilizers, in recessions the government budget deficit ________, while in expansions the deficit ________
A) falls; rises B) falls; falls C) rises; falls D) rises; rises
Which of the following will reduce the supply of motorcycles?
a. an increase in the population age 16 to 35, the primary consumers of motorcycles b. an increase in taxes imposed on motorcycle producers c. a technological improvement reducing the production costs of motorcycles d. a government study that reveals motorcycle riders, on average, live 10 years longer than those who don't ride motorcycles