Economies of scale result as a firm increases in size and expands its use of resources. Productivity increases and fixed production costs are spread over an increased number of goods and services
Which of the following are types of economies of scale? (a) Command economies
(b) External economies
(c) Open economies
(d) Closed economies
(b)
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Sam's Semiconductors produces computer chips, which it sells for $10 million to Carl's Computer Company (CCC). CCC's computers are sold for a total of $16 million. What is the value added of CCC?
A) $6 million B) $10 million C) $16 million D) $26 million
Which of the following is an example of an automatic stabilizer?
a. Congress legislates lower tax rates to increase consumption and investment. b. Tax rates are increased during a recession to maintain a balanced budget. c. A regressive income tax system reduces tax revenues (as a share of income) as income expands. d. Revenues from the corporate income tax increase sharply during a business boom but decline substantially during a recession, even though no new tax legislation has been enacted.
Inflation was the nation's number-one economic worry during
A. the 1920s. B. the late 1950s. C. the early 1960s. D. the 1970s.
What are two “safe” or reasonable conclusions that can be drawn on about the acceleration in productivity growth?
What will be an ideal response?