In the Solow model, if f(k) = 8k0.5, s = 0.2, n = 0.3, and d = 0.1, what is the value of k at equilibrium?
A. 9
B. 4
C. 1
D. 16
Answer: B
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Fiat money has
A) little to no intrinsic value but is backed by the quantity of gold held by the central bank. B) little to no intrinsic value and is authorized by the central bank or governmental body. C) value, because it can be redeemed for gold by the central bank. D) a great intrinsic value that is independent of its use as money.
If firms pay what are called "efficiency wages," they pay wages that
A) are lower than average to ensure maximum profit. B) are mandated by the government. C) will eventually lower the unemployment rate. D) motivate workers to increase their productivity.
In order to prove that Dr. Pepper and 7-Up are substitutes, the FTC should test the __________ and get a __________
a. price elasticity of demand; number less than 1 b. income elasticity; positive number c. price elasticity; negative number d. price elasticity of demand; number greater than 1 e. cross elasticity; positive number
The welfare program economists believe to be most compatible with economic efficiency is
A. a regressive tax system. B. AFDC. C. a negative income tax. D. Medicare/Medicaid.