Raising taxes or increasing transfer payments would reduce total spending
a. True
b. False
Indicate whether the statement is true or false
False
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Suppose that a firm uses both labor (L) and capital (K) as inputs. The firm's long-run production function is Q = F(L,K) = 8?L?K. The firm has _____ units of capital. If the firm uses an efficient production method and hires _____ workers, it can produce _____ units of output.
A. 100; 100; 1,200 B. 100; 225; 800 C. 225; 100; 1,200 D. 225; 225; 1,000
Which of the following is true under natural monopoly?
a. the monopolist will ignore consumers' desires. b. the marginal cost curve will lie below the average total cost curve. c. the monopolist will set price equal to marginal cost and will earn economic profits. d. output is produced under conditions of constant cost.
The AS/AD model looks similar to the microeconomic supply and demand model
A. but is not based on it. B. and is based on the microeconomic supply and demand model because the AS/AD is a macro representation of the micro model. C. and is based on the microeconomic supply and demand model because both are based on opportunity costs. D. and is based on the microeconomic supply and demand model because both are based on the principle of substitution.
Suppose there is an increase in expected future output. This will cause which of the following to occur?
A) the IS curve to shift left in the current period B) the IS curve to shift right in the current period C) the LM curve to shift up in the current period D) the LM curve to shift down in the current period