If average cost is declining,
a. marginal cost must be below average cost.
b. firms would go bankrupt if all prices were set equal to marginal costs.
c. marginal cost may be declining or increasing.
d. All of the above are correct.
d
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Which of the following would lead domestic investment to rise?
A) an increase in government spending throughout the world B) an increase in world taxes C) an increase in world autonomous consumption D) all of the above E) none of the above
Workers in industrial countries earn much higher wages than workers in developing countries because:
a. the industrial countries are labor rich and capital poor economies. b. the industrial countries lack a steady supply of unskilled laborers. c. the industrial countries produce labor intensive goods. d. the marginal productivity of labor is low in the industrial economies. e. the marginal productivity of labor is high in the industrial economies.
Assume that the central bank purchases government securities in the open market. If the nation has highly mobile international capital markets and a flexible exchange rate system, what happens to the quantity of real loanable funds per time period and the nominal value of the domestic currency in the context of the Three-Sector-Model?
a. There is not enough information to determine what happens to these two macroeconomic variables. b. The GDP Price Index rises, and nominal value of the domestic currency rises. c. The GDP Price Index falls, and nominal value of the domestic currency rises. d. The GDP Price Index rises, and nominal value of the domestic currency remains the same. e. The GDP Price Index rises, and nominal value of the domestic currency falls.
Diminishing marginal returns imply that marginal cost is rising.
Answer the following statement true (T) or false (F)