Answer the following statement(s) true (T) or false (F)
1. Physical capital generally has a positive impact on economic growth, but a negative impact on labor productivity.
2. If Keely’s company has 200,000 acres of farmland and adds 10 new workers to its team every year, the quantity of capital per worker will rise, but it will rise less and less every year.
3. In a country with little capital, a small increase in capital will result in a large increase in productivity.
4. The effects of diminishing marginal returns to capital are inescapable and cannot be mitigated.
5. According to Paul Romer, continuous innovation can result in unending economic growth.
1. FALSE
2. FALSE
3. TRUE
4. FALSE
5. TRUE
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Utility possibility frontier shows:
a. the possible combinations of utility that an efficient bargain can get the negotiating parties. b. the exact bargain at which the negotiating parties eventually arrive. c. the highest utility each negotiating party can individually achieve. d. the possible combinations that maximize payoffs to the negotiating parties.
Which of the following is not an explanation for why better educated workers earn more, on average, than less educated workers?
a. The higher wages may be a compensating differential for the cost of acquiring the education. b. Workers with a college degree signal their higher abilities to potential employers. c. Skilled labor is increasingly becoming a substitute for unskilled labor, which raises the earnings of workers with more education. d. Better educated workers are more productive, on average.
If a government sells debt to help meet its expenditures, then the government has a
a. budget surplus. Other things the same, the surplus rises if government expenditures rise. b. budget surplus. Other things the same, the surplus rises if government expenditures fall. c. budget deficit. Other things the same, the deficit rises if government expenditures rise. d. budget deficit. Other things the same the deficit rises if government expenditures fall
Prisoners in World War II POW camps traded products for other products, a process referred to as:
A. barter. B. rationing. C. central planning. D. advantage exchange.