In the long-run production function, all of the inputs to the production process are allowed to vary
Indicate whether the statement is true or false
TRUE
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A one-year Treasury bill that sells for $952.38 and has a face value of $1,000 has an annual yield of
A) 10 percent. B) 8 percent. C) 6 percent. D) 5 percent.
A social cost that is not fully paid by the individual using an automobile is
A) traffic congestion. B) gasoline and oil. C) insurance. D) depreciation of the vehicle.
If the federal government sets a minimum price for wheat at $5.00 per bushel when the equilibrium price is $4.50, then
A. a shortage will be created causing the price to rise to the equilibrium price of $4.50. B. a permanent shortage will develop because the government established the minimum price at $5.00. C. a surplus will be created causing the price to fall to the equilibrium price of $4.50. D. a permanent surplus will develop because the government established the minimum price at $5.00.
Suppose that, as expected, aggregate demand in the economy sharply declines. New classical economists say that the price level will _____________ and real output will ____________
A. fall; remain constant B. fall; fall C. remain constant; fall D. remain constant; rise