Production technologies A and B can have the same-shaped isoquant map, with technology A having decreasing returns to scale and technology B having increasing returns to scale.
Answer the following statement true (T) or false (F)
True
Rationale: See Graph 12.5 in the text.
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An optimal choice can be characterized as a decision made by someone who is satisficing.
Answer the following statement true (T) or false (F)
As more labor is hired, moving along the production function, diminishing returns occur because
A) workers are overworked and so their productivity decreases. B) the wage rate paid is too low and so workers decrease their work effort. C) there are fixed quantities of other resources. D) the real wage rate must increase in order to hire additional workers. E) real GDP increases more rapidly the more workers are hired.
Using the DD-AA framework, which one of the following statements is the MOST accurate?
A) Only monetary policy can bring the economy to full employment. B) Only fiscal policy can bring the economy to full employment. C) Only both monetary and fiscal policies can bring the economy to full employment. D) Both policies are capable of bringing the economy to full employment and low inflation. E) Monetary policy by itself or fiscal policy by itself can bring the economy to full employment.
If the null hypothesis states H0 : E(Y) = µY,0, then a two-sided alternative hypothesis is
A) H1 : E(Y) ? µY,0. B) H1 : E(Y) ? µY,0. C) H1 : < µY,0. D) H1 : E(Y) > µY,0.