In the production function Y = AF(K, N), A is ________, K is ________, and N is ________.
A. the productivity of labor; the capital stock; the size of the labor force
B. the productivity of labor; investment; the size of the labor force
C. total factor productivity; the capital stock; the number of workers employed
D. total factor productivity; investment; the number of workers employed
Answer: C
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Which of the following is NOT a monetary policy goal?
A) keeping long-term interest rates moderate B) maintaining stable prices C) keeping a high exchange rate for the dollar D) promoting maximum employment E) All of the above are monetary policy goals.
The optimal time for the implementation of contractionary fiscal policy would be
a. before inflation accelerated. b. after inflation accelerated. c. after unemployment increased. d. after the price level had risen significantly.
When a country allows trade and becomes an importer of a good,
a. consumer surplus and producer surplus both increase. b. consumer surplus and producer surplus both decrease. c. consumer surplus increases and producer surplus decreases. d. consumer surplus decreases and producer surplus increases.
Starting from long-run equilibrium, a large tax increase will result in a(n) ________ gap in the short-run and ________ inflation and ________ output in the long-run.
A. recessionary; lower; potential B. expansionary; lower; potential C. expansionary; higher; potential D. recessionary; lower; lower