The marginal product of capital is the increase in
A. capital needed to produce one more unit of output.
B. labor needed to accompany a one-unit increase in capital.
C. output from a one-unit increase in capital.
D. output from a one-dollar increase in capital.
Answer: C
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M1 differs from M2 in that:
A. M2 includes savings deposits, small-denomination time deposits, and money market mutual funds that are not included in M1. B. M1 includes currency and balances held in checking accounts, which are not included in M2. C. the assets in M2 are more liquid than the assets in M1. D. M1 is a broader measure of the money supply than M2.
If pretzels are a normal good, the income effect of a price change means that
a. as income increases, the quantity demanded increases along the demand curve for pretzels b. as income increases, the demand curve for pretzels shifts rightward c. as income increases, the demand curve for pretzels shifts leftward d. as the price of pretzels increases, the real income of individuals who demand pretzels decreases, so the quantity demanded of pretzels decreases e. as the price of pretzels increases, income increases
Private firms and public bureaus differ in the sense that public bureaus
a. sometimes have top-level managers chosen by shareholders b. sell most of their output on a per unit basis c. receive most of their revenues through a budget appropriation rather than through the sales of goods or services d. are sometimes inefficient e. hire consultants to solve difficult problems
If the favorable supply shocks of the 1990s were reversed in the future, we should expect a(n)
a. increase in inflation and unemployment. b. decrease in inflation and unemployment. c. increase in inflation and a decrease in unemployment. d. decrease in inflation and an increase in unemployment.