Technological change moves the economy upward along the existing production function, thereby increasing productivity and living standards
a. True
b. False
B
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Purchasing power parity means that the expected exchange rate is such that the returns from investing in two nations are equal
Indicate whether the statement is true or false
Given that shares are riskier than bonds, why do investors invest in equity?
What will be an ideal response?
When a firm’s AC eventually starts to rise, it is often because
A. executive salaries rise sharply as output rises. B. the ability to manage larger and larger levels of output results in much higher administrative costs. C. marginal cost increases rapidly at higher output levels. D. firm output has started to decline.
At an exchange rate of 1 pound = $2.00, an American product is sold for the equivalent of 50 pounds in Britain. Assuming that the dollar price does not change, what will be the new equivalent British-pound price if the exchange rate for a British pound rises to $3?
A. 100.0 pounds B. 50.0 pounds C. 33.3 pounds D. 24.5 pounds