Refer to the data. At $20 million of R&D expenditures, the:
A. marginal cost of R&D exceeds the marginal benefit.
B. expected total return from R&D is at a maximum.
C. interest-rate cost of funds is negative.
D. marginal benefit of R&D exceeds the marginal cost.
D. marginal benefit of R&D exceeds the marginal cost.
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Suppose the government of a country wants to increase the aggregate demand of its economy by $10 billion at all price levels. However, it currently has a balanced budget with no surplus and is unwilling to borrow money to finance fiscal policy. The government could still accomplish its goal by increasing government purchases by ________ and increasing taxes by $10 billion.
A. $20 billion. B. $10 billion C. $15 billion. D. $5 billion
Why does the production possibilities frontier have a bowed out shape rather than being a straight line?
What will be an ideal response?
Other things equal, an increase in aggregate demand will result in:
a. an economic expansion. b. higher unemployment and a lower equilibrium price level. c. an economic recession. d. a decrease in equilibrium real GDP and an increase in the equilibrium price level. e. a decrease in the overall economic welfare.
In an economy with no inflation, explain why interest rates are positive
What will be an ideal response?