If unplanned investment is $45 million and planned investment is $45 million, then actual investment is
A. $90 million.
B. $45 million.
C. zero.
D. -$45 million.
Answer: A
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Suppose our firm produces chartered business flights with capital (planes) and labor (pilots) in fixed proportion (i.e., one pilot for each plane)
If the wage rate paid to the pilots increases relative to the rental rate of capital for the airplanes, then: A) the optimal capital-labor ratio should increase. B) the optimal capital-labor ratio should decrease. C) the optimal capital-labor ratio remains the same. D) We do not have enough information to answer this question.
Counting involuntary part-time workers as unemployed would
A) raise the full employment rate. B) not change the actual unemployment rate. C) raise the natural unemployment rate. D) raise the measured unemployment rate. E) lower the measured unemployment rate.
Nonexcludable goods tend to be undersupplied because:
A. people do not pay the true value of the good. B. the free rider problem persists. C. people rarely willingly pay for something they could get for free, regardless of how much they value it. D. All of these statements are true.
The table below shows how the marginal benefit of car washes varies for Carol with the number purchased per month.Car washes per monthMarginal benefit of purchasing an additional car wash1$6.002$5.003$4.004$3.005$2.00The price of each car wash is reduced from $2.99 to $1.99. Assuming that the price of a car wash accurately reflects the marginal cost to Carol and that she is rational, she will increase the number of car washes purchased per month from:
A. one to two. B. two to three. C. three to four. D. four to five.