Suppose that an economy's labor productivity and total worker-hours each grew by 3 percent between year 1 and year 2. We could conclude that this economy's:
A. real GDP remained constant.
B. capital stock increased by 3 percent.
C. production possibilities curve shifted inward.
D. production possibilities curve shifted outward.
D. production possibilities curve shifted outward.
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A normative statement is
A) about what ought to be. B) about what is. C) always true. D) one that does not use marginal concepts.
Comment on the following statement. "Taxing externality-producing activities may not eliminate damages."
What will be an ideal response?
An import quota is an example of
A) a price ceiling. B) a price floor. C) a queuing device. D) a quantity restriction.
In which of the following ways does government affect the consumption component of planned aggregate expenditures?
a. Through net taxes, which change disposable income b. By purchasing goods and services, which increase consumption c. By using subsidies to encourage firms to invest d. By reducing the interest rate to encourage firms to invest e. By producing public goods