Select the accurate statement below:
A) European Union budget problems are due to decline in real estate values since the Great Recession
B) US budget problems are due to increasing Medicare and Social Security arising from demographic changes
C) US budget problems are due to the rising costs of medical care from the expansion of Medicaid
D) Japanese budget problems are due to the increase in the number of people below working age
Answer: B) US budget problems are due to increasing Medicare and Social Security arising from demographic changes
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Suppose the production of mp3 players can be represented by the following production function: q = L0.4K0.4. Which of the following statements is TRUE?
A) The production function has decreasing returns to scale. B) The production function has increasing returns to scale. C) The production function has constant returns to scale. D) Returns to scale vary with the level of output.
If Jennifer didn't have class in the evening, she would save the $4 campus parking fee and spend four hours at work where she earns $10 per hour. The opportunity cost of attending class is: a. $0
b. $4. c. $40. d. $44.
If the price of gasoline has increased from $2 per gallon to $4 per gallon at the same time that the overall price index increased from 200 to 450, then you know that the inflation adjusted price of gasoline has
A. decreased. B. remained constant. C. increased.
Exhibit 2-17 Production possibilities curve
In Exhibit 2-17, if countries A and B currently have the same production possibilities curve (PPC) as given in the figure, but this year country A locates at point A on its PPC and country B locates at point B on its PPC, then country A:
A. is more efficient than country B. B. will grow at a faster rate than country B. C. will grow at a slower rate than country B. D. is producing more capital goods than country B.