The fundamental force that drives trade between nations is
A) the government.
B) NAFTA.
C) absolute advantage.
D) comparative advantage.
E) legal treaties.
D
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Labor productivity is defined as
A) the amount of workers per unit of input. B) the amount of input per worker. C) the increase in output per unit of machinery. D) the amount of output per worker.
In 2008, the Treasury and Federal Reserve took several actions in response to the deepening financial crisis
One action was the creation of the Term Securities Lending Facility, under which the Fed will loan up to $200 billion of treasury securities in exchange for A) stock. B) corporate bonds. C) mortgage-backed securities. D) required bank reserves.
Constant returns to scale means that, given any constant x > 0
A) xzF(xK, xNd)= zF(xK, xNd). B) xzF(xK, xNd) > zF(xK, xNd). C) xzF(xK, xNd) < zF(xK, xNd). D) xzF(xK, xNd) = zxF(K, Nd).
A multi-plant firm has three plants and, at its current production levels, the marginal cost of production at each of the three plants is $2.00. If the firm is perfectly competitive and the market price of its product is $5, which of the following is true?
A) The firm should exactly triple output in each of the plants to maximize profit. B) The firm is not producing the profit-maximizing total output. C) The firm is producing the profit-maximizing total output. D) The firm should increase output at each of the plants to maximize profit.