A key assumption of the Keynesian model of macroeconomics is a fixed _____
a. interest rate
b. price level
c. exchange rate
d. growth rate
e. unemployment level
b
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A well-run bank assumes that all borrowers will repay their loans on time, irrespective of the condition of the economy
a. True b. False Indicate whether the statement is true or false
Which of the following statements about the circular-flow diagram is correct?
a. One must imagine that the economy operates without money in order to make sense of the diagram. b. The diagram leaves out details that are not essential for understanding the economic transactions that occur between households and firms. c. The government cannot be excluded as a decision maker in a circular-flow diagram. d. All of the above are correct.
An individual labor-demand curve represents:
A. the decisions of all firms around how many hours to work at each alternative wage. B. the decisions of all workers around how many hours to work at each alternative wage. C. a worker's decisions around how many hours to work at each alternative wage. D. a firm's decisions around how many hours to hire at each alternative wage.
In the Primary Metals industry, it is estimated that the elasticity of output with respect to labor is 0.51 and the elasticity of output with respect to capital is 0.73. These two measures indicate that the primary metals industry is characterized by
A) decreasing returns to scale. B) constant returns to scale. C) increasing returns to scale. D) no returns to scale.