Which of the following would not be classified as capital formation?
a. buying shares of stock
b. building a new warehouse
c. purchasing new construction equipment
d. All would be considered capital formation.
a
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A market economy depends on market mechanisms to: a. determine the most efficient way of using resources
b. determine how large the government's budget deficit should be. c. decide how much government regulation there should be. d. provide everyone with a minimum level of income.
An upward-sloping labor-supply curve implies that an increase in the wage induces
a. firms to increase the quantity of labor they hire. b. firms to increase the quantity of output they produce. c. workers to decrease the quantity of leisure they enjoy. d. All of the above are correct.
Toot Sweets Bakery sells freshly baked muffins from 6.30 am at $1.20 per muffin. By 4 pm, the remaining muffins are marked down to $0.60 each. Which of the following statements is true?
A) Toot Sweets is trying to minimize its loss.
B) Toot Sweets engages in price discrimination; a higher price for those who cannot wait and a lower price for those willing to wait until 4 pm.
C) Toot Sweets has underestimated the demand for its muffins.
D) Toot Sweets is trying to prevent the opportunity to make arbitrage profit.
A decline in the exchange rate could have been caused by which of these factors?
A. An increase in the domestic real interest rate B. An increase in foreign output (income) C. A decline in domestic output (income) D. A decline in the world demand for domestic goods