The MPC in the U.S. economy has been estimated to be near 0.95 . If this is an accurate measure, then the numerical value for the multiplier would be
a. 0.9.
b. 1.8.
c. 9.5.
d. 10.0.
e. 20.0.
e
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When people purchase health insurance and then change their behavior after the purchase because the insurance protects them from loss, the health insurance market is said to face the problem of
A) asymmetric information. B) moral hazard. C) adverse selection. D) the rationality paradox.
The returns to scale of the production function Q = 50 L0.4 K0.2 are
A) 50. B) .6. C) .8. D) 500.6.
In a constant-cost industry, inputs prices do not change with changes in output.
Answer the following statement true (T) or false (F)
Productive efficiency is achieved when
A) firms add a low profit margin to the goods and services they produce. B) firms produce the goods and services that consumers value most. C) firms produce goods and services at the lowest cost. D) there are no shortages or surpluses in the market.