Which of the following, if implemented in the Solow growth model, would not lead to a steady state?
A) A higher population growth rate.
B) Decreasing returns to scale in production.
C) A savings rate that decreases as income increases.
D) A constant marginal product of capital.
D
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When drawn against current income, the slope of the Cd (r) + Id (r) + G curve is equal to the marginal
A) product of capital. B) product of labor. C) propensity to consume. D) propensity to save.
Which of the following rises during a contraction and falls during the expansion phase of the business cycle?
a. prices b. unemployment c. output d. interest rates
A tax on U.S. imports of Chinese-made tires is likely to:
reduce the price of tires for the domestic buyers for tires in the U.S. reduce the volume of imports increase the volume of imports have no effect on the volume of imports
Which of the following is a key characteristic of the long-run competitive equilibrium that distinguishes it from the short-run competitive equilibrium?
A. Free entry to reduce short-run profits, or free exit to reduce short-run losses. B. Economic profits are positive, but cannot be negative. C. Marginal revenue is greater than marginal cost. D. Average revenue is less than average cost.