When Lonnie produces 1 pair of cowboy boots his costs total $300. When he produces 2 pairs of cowboy boots his total costs are $500. This means that Lonnie's marginal cost of producing the second pair of cowboy boots is $200
Indicate whether the statement is true or false
TRUE
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The aggregate production function is graphed as
A) a downward sloping curve. B) an upward sloping straight line. C) an upward sloping line that becomes flatter as the quantity of labor increases. D) an upward sloping line that becomes steeper as the quantity of labor increases.
If a firm's output less than doubles when all inputs are doubled, production is said to occur under conditions of
A) increasing returns to scale. B) imperfect competition. C) intra-industry equilibrium. D) constant returns to scale E) decreasing returns to scale.
Which of the following actions would be most likely to increase economic growth in a developing country?
a. establishment of a command economy that can set definite goals for the future and implement them b. an increase in foreign aid to finance spending on infrastructure such as roads and bridges c. development of a legal system that fairly protects people and their property d. construction of new colleges to expand higher education
How do you interpret the value of income elasticity?
What will be an ideal response?