Critically evaluate the following statement. "Short-run costs curves must be downward-sloping because after all labor is increasingly more productive."
What will be an ideal response?
If indeed labor were increasingly more productive this would indeed be true. However, in most productive processes the law of diminishing marginal productivity sets in eventually and leads to a U-shaped short-run average cost function.
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Banks would be expected to minimize holding excess reserves because this practice is
A. illegal.
B. not profitable.
C. technically difficult.
D. subject to a stiff excess reserves tax.
A characteristic of stock prices is that ________
A) they tend to go up on the upswing of the cycle B) they tend to go down on the downswing of the cycle C) they are a leading indicator D) all of the above E) none of the above
If polluters are forced to pay for the cost of their pollution, they will reduce pollution toward a socially optimal amount.
Answer the following statement true (T) or false (F)
A human resource such as ingenuity can be thought of as
A. a causal factor for aggregate supply shifting left. B. part of a country's endowment. C. the outcome of more investment spending. D. part of government spending programs.