A permanent increase in autonomous investment causes
A. more than that amount of increase in real Gross Domestic Product (GDP).
B. less than that amount of increase in real Gross Domestic Product (GDP).
C. an offsetting change in saving that leaves real Gross Domestic Product (GDP) at the same level.
D. the same amount of increase in real Gross Domestic Product (GDP).
Answer: A
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A nation's average annual real GDP growth rate is 3%. Based on the "rule of 72," the approximate number of years that it would take for this nation's real GDP to double is
A. 40 years. B. 175 years. C. 17.5 years. D. 24 years.
Refer to Figure 16.1. An increase in expected output in the future is best represented by a movement from
A) point A to point B. B) point B to point A. C) point A to point C. D) point C to point A.
Suppose a farmer is a price taker for soybean sales with cost functions given by TC = .1q2 + 2q + 30 MC = .2q + 2 If P = 6 , the profit-maximizing level of output is
a. 10 b. 20 c. 40 d. 80
Figure 2-3
shows the production possibilities frontier for a music processing plant that can produce both compact disks and cassettes. The opportunity cost of moving from point A to point E is
a.
zero
b.
30 cassettes
c.
180 compact disks
d.
cannot be determined because point E is unattainable under current technology and resources
e.
80 cassettes