The per-worker production function flattens out due to ________
A) the negative relationship between price and quantity demanded
B) the positive relationship between price and quantity demanded
C) the diminishing marginal product of capital
D) an increase in the general level of prices
C
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The Solow residual is a measure of
A) average labor productivity. B) average capital productivity. C) total factor productivity. D) the rate of growth of real GDP.
Since wages fell by more than prices, Civil War laborers were better off
Indicate whether the statement is true or false
If a positive permanent supply shock were to occur, the resulting equilibrium would be a:
A. higher level of output at lower prices. B. lower level of output and prices. C. higher level of output and prices. D. lower level of output at higher prices.
The president of the Micro Brewing Corporation asks you, as the company economist, to forecast changes in consumer beer purchases associated with a proposed price change. You conduct a survey and find that if the price of a six-pack increases from $5.50
to $7.50, the quantity demanded will decrease from 2200 units to 1800 units a month. Should the Micro Brewing Corporation raise its price? Explain the economic basis for this recommendation to the president. Please provide the best answer for the statement.