Give at least three examples from economics where you expect some nonlinearity in the relationship between variables. Interpret the slope in each case
What will be an ideal response?
Answer: Typical answers involve the Cobb-Douglas production function, the Phillips curve, earnings functions, and (given the textbook discussion) student performance and income.
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A reduction in nominal wages will cause which of the following?
A) a leftward shift in the short-run aggregate supply curve to shift to the left B) a movement along the short-run aggregate supply curve C) a shift of both the short-run and long-run aggregate supply curves D) a rightward shift in the short-run aggregate supply curve
Marginal cost can be determined best by observing changes in
a. average total cost. b. total variable cost. c. total fixed cost. d. total cost/marginal product.
Which of the following is most likely to occur when the government enacts policies to make the distribution of income more equal?
a. a more efficient allocation of resources b. a distortion of incentives c. unchanged behavior d. All of the above are correct.
The reason that most of the coffee that is consumed in the United States comes from Colombia is that
A. Colombia has an absolute advantage in producing coffee relative to the United States. B. Colombia has a comparative advantage in producing coffee relative to the United States. C. government trade disincentives regarding Colombian coffee make such trade possible. D. coffee cannot be grown in the United States.