The GI Bill provided educational opportunities to many young men returning from military service. Using a production possibilities curve, demonstrate how the GI Bill affected economic growth and explain your answer
Implementation of the GI Bill shifted the U.S. economy's production possibilities curve in an outward direction. The availability of educational subsidies helped former soldiers attain higher levels of education, thereby adding to the nation's stock of human capital and improving the productivity of labor.
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Comparing fixed to flexible exchange rate, the response of an economy to a temporary fall in foreign demand for its exports is
A) output actually falls less under fixed rate than under floating rate. B) output actually falls more under fixed rate than under floating rate. C) output actually remains the same under fixed rate than under floating rate. D) the currency value grows in a fixed rate system and falls in a flexible system. E) output grows in a fixed rate system and falls in a flexible system.
Suppose a farmer in a perfectly competitive agricultural industry rents land that is uniquely productive in the production of a certain crop. In the long run
A) the owner of the land receives economic rent while the farmer earns zero economic profit. B) the owner of the land earns zero economic profit while the farmer receives economic rent. C) both the farmer and the owner of the land receive economic rent. D) neither the farmer nor the owner of the land receive economic rent.
Ian McDonald owns a company that sells sleds in a perfectly competitive market. A lighter-than-normal snowfall has caused the market demand curve for sleds to shift to the left. In the short run, which of the following is likely to happen?
a. The market price for sleds will remain unchanged. b. The market price for sleds will increase. c. More sled producers will enter the industry. d. Increased economic profit will be earned by the firms in the sled industry. e. The market price for sleds will fall.
In the Shleifer-Vishny model, producers want:
a. the highest possible prices from regulators b. no regulation c. low regulated prices d. planned socialism e. none of the above