As its capital stock increases, a nation will
a. move rightward along a fixed production function
b. move leftward along a fixed production function
c. find its production function shifting upward
d. find its production function shifting downward
e. experience no change in the marginal product of labor
C
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If current unemployment is close to the natural rate of unemployment, the level of the ________ GDP is likely to be close to the level of potential output
A) real B) structural C) nominal D) estimated
An increase in income taxes ________ employment and ________ potential GDP
A) increases; increases B) increases; does not change C) decreases; decreases D) does not change; does not change E) increases; decreases
Some environmentalists have criticized tradable emission allowances on the grounds that they give permit holders a license to pollute
Furthermore, environmentalists argue that those who sell their permits receive a monetary benefit from their contribution to polluting the environment. Use economic reasoning to evaluate this criticism.
A rightward shift of a market supply curve might be caused by:
a. the entry of new firms in the industry. b. an increase in the wages of labor employed in the industry. c. an increase in the price of the final product. d. a decrease in the income of consumers. e. an increase in the supply of a substitute good.