Which of the following has a production process that would be considered capital intensive?
A. A chorale
B. Police detective work
C. Auto manufacturing
D. Serving food at a restaurant.
C. Auto manufacturing
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Over time in the long run we expect unplanned inventory expenditure to:
A. equal zero as planned inventories should equal actual inventories. B. increase because firms have a hard time figuring out what consumers want. C. be negative as firms will tend to reduce production is they think people won’t purchase their product. D. be positive as on average firms tend to be optimistic about sales, but if they don’t sell product they store it.
Keynes emphasized the idea that wages and prices adjusted very rapidly bringing an economy back to the full employment level of output
a. True b. False Indicate whether the statement is true or false
Under the total revenue and total cost approach to profit maximization,
a. firms equate total variable cost to total revenue in order to maximize profit b. profit is maximized when fixed cost falls to zero c. firms choose the level of output at which total revenue is the greatest distance above total cost when the firm earns an economic profit d. firms choose the level of output at which the changes in revenue and cost both equal zero e. total revenue is maximized when profit is zero
What are the prerequisites for money creation?