Capital is a flow of resources into the production of investment goods.
Answer the following statement true (T) or false (F)
False
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If a product is narrowly defined, it is likely to
A) have many substitutes and therefore its demand is elastic. B) have few substitutes, and therefore its demand is less elastic. C) be unique, and therefore its demand is inelastic. D) be unique and have many substitutes. E) have a larger proportion of income spent on it.
The ATC curve and the AFC curve for information products (e.g., software) in the short run are
A) downward sloping. B) horizontal. C) upward sloping. D) vertical.
Suppose a firm uses workers and office space to produce output. The firm is locked into a year-long lease on its office space, but it can easily vary the number of employee-hours it uses each day. The accompanying table describes the relationship between the number of employee-hours the firm uses each day and the firm's daily output. Each unit of output sells for $2, the hourly wage rate is $14, and the rent on the office space is $50 per day.Employee-Hours Per DayOutput Per Day0014048091201516023200 What is the marginal cost of production between 80 and 120 units of output each day?
A. $70 B. $14 C. $1.75 D. $1.40
Holding other factors constant, if terrorist attacks increase the desire for precautionary saving, then the real interest rate will ________ and the equilibrium quantity of saving and investment will ________.
A. decrease; decrease B. decrease; increase C. increase; increase D. increase; decrease