In an open economy, an increase in foreign output would cause the IS curve to shift ________ and a decrease in the foreign real interest rate would cause the IS curve to shift ________.
A. down; down
B. down; up
C. up; up
D. up; down
Answer: D
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Reputational rents refer to
A) the profit earned by a firm when it captures economies of scope. B) the costs associated with building credibility of a firm. C) the profit earned solely based on the credibility of a firm. D) the costs associated with the firm's achievement of economies of scale.
The assumption that in the long run prices and wages are fully flexible implies that the long-run aggregate supply curve is determined by ________
A) capital and labor inputs B) technology C) the natural rate of unemployment D) all of the above E) none of the above
If two economists disagree on an issue and their disagreement is based on personal value judgments, then this controversy is a normative one
a. True b. False
In the U.S. economy in 1991, real GDP was 4861.4 (in billions of 1987 dollars), the capital stock was 13,806.2 (in billions of 1987 dollars), and employment was 118.4 (in millions of workers). In 1992 the numbers were: real GDP 4986.3, capital stock 14,040.8, employment 119.2. Suppose the production function in both years is Y = AK0.25N0.75.(a)Calculate total factor productivity for 1991 and 1992.(b)How much did total factor productivity grow from 1991 to 1992?(c)Calculate the percent increase in real output between 1991 and 1992.(d)Suppose tax incentives had raised the capital stock in 1992, making it 10% higher, to 15,444.9. If employment didn't change, what would have been the percent increase in real output between 1991 and 1992?(e)Instead of the increase in the capital stock in
part d, suppose employment was 10% higher in 1992, making it 131.1. With the capital stock fixed at 14,040.8, what would have been the increase in real output between 1991 and 1992? What will be an ideal response?