If the production possibilities frontier is a straight line,
a. its slope will equal -1
b. resources must not be used efficiently
c. resources must be unemployed
d. society must not be using the latest technology
e. resources must be equally adaptable at producing either product
E
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The main reason that the 1975, 2008, and 2009 tax cuts did not have a large effect on GDP is that they were
a. temporary surcharges rather than permanent surcharges. b. permanent surcharges rather than temporary surcharges. c. temporary tax cuts rather than a permanent tax cuts. d. permanent tax cuts rather than a temporary tax cuts.
Increasing returns to scale:
a) means that output rises proportionately more than inputs, resulting in increasing per unit costs. b) means that output rises proportionately more than inputs, resulting in lower per unit costs in the long run. c) has the same meaning as increasing costs of production. d) means that output rises proportionately less than inputs, increasing per unit cost of production in the short run. e) implies that the long-run average cost curve is shifting downward.
A decreasing-cost industry is one in which:
A. contraction of the industry will decrease unit costs. B. input prices fall or technology improves as the industry expands. C. the long-run supply curve is perfectly elastic. D. the long-run supply curve is upsloping.
Suppose you drive downtown, pay for parking at a private parking garage, and go to see an investment advisor. He charges you a $5 fee to advise you to purchase 100 shares of stock, which you do. Which of these transactions is NOT included in GDP?
A. your purchase of the stock B. paying the $5 fee to the investment advisor C. the purchase of gas for the trip D. paying the parking fee