Productivity growth is the main cause of rising living standards
a. True
b. False
Indicate whether the statement is true or false
True
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Based on the figure below. Starting from long-run equilibrium at point C, a tax cut that increases aggregate demand from AD to AD1 will lead to a short-run equilibrium at point ________ and eventually to a long-run equilibrium at point ________, if left to self-correcting tendencies.
A. D; C B. B; C C. B; A D. D; B
Firms discount future profits at the interest rate r because
A) it is the interest rate on their debt. B) it is the same rate as for households. C) Ricardian equivalence holds. D) it has to equal the marginal productivity of capital in equilibrium.
The authors cite a recent study of MBA programs that compares pre-MBA salaries with post-MBA salaries
For some of the highest ranked schools, the salary difference was roughly $100,000 per year, and the difference was roughly $60,000 for some schools ranked near the bottom of the top 20. Is it possible that the financial returns from an MBA earned at a lower ranked school may actually exceed the returns from a top ranked school? A) Yes, the lower ranked schools may provide a higher net present value for the degree if their tuition is low enough. B) Yes, but the potential gains depend on the discount rate and not the tuition. C) No, the salary advantages of the top ranked schools always payoff in the long run. D) We do not have enough information to answer the question.
The following question relates to an oligopoly market where the industry demand curve is P = 100 - Q. What will be the price and quantity of this duopoly market if the duopolists act as shared monopolists?
What will be an ideal response?