A technological innovation that increases the marginal physical product of capital would eventually result in a(n)
a. increase in the interest rate
b. decrease in the interest rate
c. shift to the right of the supply curve of loanable funds
d. increase in the quantity demanded of loanable funds and a decrease in the quantity supplied of loanable funds, which leaves the interest rate unchanged
e. shift to the left of the supply curve of loanable funds
A
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In the short run, if a firm produces nothing, total costs are zero
a. True b. False Indicate whether the statement is true or false
The "naïve" Keynesian model is unrealistic because it
A. Does not take into account probable changes in the price level as the economy approaches full employment. B. Assumes that AS is upward sloping when it is more probably horizontal. C. Assumes that the price level decreases as AD increases. D. Does not account for changes in output due to the multiplier.
Explain the differences between the price leadership model and collusive oligopoly.
What will be an ideal response?
The desired level of inventories is the level at which the extra cost (in lost sales) from lowering inventories by a small amount is
A. greater than the extra gain (in interest revenue and decreased storage costs). B. just equal to the extra gain (in interest revenue and decreased storage costs). C. zero. D. less than the extra gain in (in interest revenue and decreased storage costs).