Which of the following is a property of an isoquant?
a. It is concave to the origin.
b. Its slope is given by the ratio of the marginal products, for example, (marginal product of capital) ÷ (marginal product of labor), where capital and labor are measured on the Y and X-axes respectively.
c. It gives the lowest-cost way of producing a certain level of output.
d. Isoquants cannot intersect each other.
D
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Substitution bias:
a. overstates the rise in a consumer’s true cost of living. b. understates the rise in a consumer’s true cost of living. c. overstates the decrease in a consumer’s true cost of living. d. understates the decrease in a consumer’s true cost of living.
If monetary policy is used to set the market equilibrium value of the exchange rate equal to the official value, it is no longer available to:
A. stabilize the domestic economy. B. decrease the market equilibrium value of an overvalued currency. C. increase the market equilibrium value of an overloaded currency. D. stabilize the market equilibrium value of the exchange rate.
Which of the following is a tool of the Federal Reserve System?
A. Encouraging employment by lending money at a discounted rate to firms that are in danger of having to make layoffs. B. Reducing the burden of household debt by capping credit card and other loan interest rates at reasonable levels C. Buying or selling stocks of publicly traded corporations in order to stabilize the stock market D. Buying or selling bonds in the open market in order to stimulate the economy during recessions and prevent inflation
Refer to the information provided in Figure 2.5 below to answer the question(s) that follow.
Figure 2.5Refer to Figure 2.5. For this economy to move from Point C to Point B, ________ additional LCD TVs could be produced when the production of OLED TVs is reduced by 20.
A. exactly 30 B. exactly 60 C. fewer than 30 D. more than 30