An increase in the stock of capital in a society is called capital deepening
a. True
b. False
Indicate whether the statement is true or false
False
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If the per-worker production function shifts down,
A) the per-worker production function becomes steeper. B) it now takes more capital per hour worked to get the same amount of real GDP per hour worked. C) an economy can increase its real GDP per hour worked without changing the level of capital per hour worked. D) positive technological change has occurred in the economy.
The nominal interest rate minus the inflation rate equals the real interest rate
Indicate whether the statement is true or false
The elasticity of demand for a product is likely to be greater
A) the smaller the number of substitute products available. B) the smaller the proportion of one's income spent on the product. C) the larger the number of substitute products available. D) if the product is an imported good rather than a domestically produced good.
A manager invests $400,00 . in a technology to reduce overall costs of production. The company managed to reduce their cost per unit from $2 to $1.85 . After a year, the manager has an opportunity to outsource production to another company at a cost per unity of $1.75 . If you are the manager, you
a. should consider the $400,00 . as sunk cost and therefore it should not be relevant to the decision. b. should base your decision upon economic profit and not accounting profit c. should avoid the fixed-cost fallacy d. all the above