If a technological advance expands output and requires a smaller investment in capital goods, this technological advance:
A. is capital-using.
B. must involve nonfinancial investment.
C. is capital-saving.
D. must pertain to the infrastructure.
C. is capital-saving.
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Suppose there are 20 competitive firms in a market. The supply curve of each firm is q = 2p. The market demand is Q = 200 - 2p. What is the residual demand curve facing a typical firm?
What will be an ideal response?
Firms in a high-wage nation such as the U.S. can compete effectively with imports from low-wage nations if
a. skill levels are identical in the nations b. the U.S. reduces tariffs on imports c. low-wage nations impose tariffs on U.S. made goods d. labor productivity is higher in the low-wage nation e. labor productivity is higher in the U.S.
An decrease in the money supply will lead to a ______.
a. higher interest rate in the short run b. lower interest rate in the short run c. higher interest rate than the original in the long run d. lower interest rate than the original in the long run
For this question, assume that individuals do not hold currency (i.e., c = 0). If the ratio of reserves to deposits is .10, the money multiplier is
A) .1. B) .9. C) 4. D) 5. E) 10.