"When workers already have a large quantity of capital to use in producing goods and services, giving them an additional unit of capital increases their productivity only slightly.". This statement
a. represents the traditional view of the production process.
b. is an assertion that capital is subject to diminishing returns.
c. is made under the assumption that the quantities of human capital, natural resources, and technology are being held constant.
d. All of the above are correct.
d
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The term "depository institution" refers to
A) savings and loan associations only. B) commercial banks, credit unions, and savings and loan associations. C) credit unions only. D) commercial banks only.
The information conveyed by changes in market prices is especially important in financial markets because
a. It forces individual investors to reveal their information about the prospects of a security b. It assesses business decisions c. It helps firms forecast the future demand for products d. All of the above
Suppose a consumer is spending all of his/her income on two goods, A and B, in a manner where MUa = 15 and MUb = 80, and the Pa = $5 and the Pb = $20 . Then the consumer:
a. is maximizing his/her utility. b. should increase his/her purchases of B and decrease the purchases of A. c. should spend more money on both goods. d. should spend less money on both goods. e. should increase the purchases of A and decrease the purchases of B.
In the event of a recession, which of the following is the most likely policy stance of those who advocate a passive approach to economic policy?
a. Cutting taxes b. Increasing government spending c. Reducing interest rates d. Increasing the money supply e. Doing nothing