Let the production function be q=ALaKb. The function exhibits increasing returns to scale if
A) a + b = 1.
B) a + b > 1.
C) a + b < 1.
D) Cannot be determined with the information given.
B
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The desired reserve ratio is 10 percent. Fly By Night Bank has deposits of $250,000 and reserves of $25,000. What is the amount of its excess reserves?
What will be an ideal response?
Which of the following legal subjects is most concerned with the economic function of the legal system?
A) criminal law B) public goods C) antitrust legislation D) civil rights
In some rural regions of the United States, residents harvest much of their food supplies directly from nature by hunting, fishing, and gathering. With regard to these subsistence activities: a. GDP will overestimate the true value of the nation's production of final goods and services
b. GDP will underestimate the true value of the nation's production of final goods and services only when the income approach is used. c. GDP will correctly estimate the true value of the nation's production of final goods and services. d. GDP will underestimate the true value of the nation's production of final goods and services.
Menu costs refers to
a. resources used by people to maintain lower money holdings when inflation is high. b. resources used to price shop during times of high inflation. c. the distortion in incentives created by inflation when taxes do not adjust for inflation. d. the cost of more frequent price changes induced by higher inflation.