Depreciation or consumption of fixed capital depreciation measures:
a. net investment less gross investment.
b. the loss of productive ability due to capital intensive production.
c. capital that is wasted in the production process.
d. the value of existing capital stock used up in the production process.
e. the decline in the value of inventories caused by inflation.
d
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A increase in quantity demanded as a result of a change in price
A) is a rightward shift of the demand curve. B) is a leftward shift of the demand curve. C) leaves the demand curve unchanged. D) is not possible.
Economists predicted that the price of a depletable natural resource would rise by about 15 percent. Actually the price fell 10 percent. What most likely happened?
A. A government subsidy was removed. B. Extraction costs increased. C. Price controls were suspended. D. An unexpected discovery of reserves was made.
Which of the following is a likely result of a subsidy?
a. An increase in the revenue received by a government b. An increase in the subsidized economic activity c. An increase in equilibrium market price d. An increase in net social welfare
Inflation in the U.S. economy tends to be:
A. a finite, one-time event resulting from a shock. B. ongoing, as increases in aggregate demand generally exceed the increases in aggregate supply. C. a finite, one-time event as the Fed actively works to eliminate all inflation. D. ongoing, as aggregate supply is continually shifting to the left.