All of the following would affect the position of the supply curve for cranberries, except the:
A. Popularity of cranberry drinks
B. Price of agricultural land for cranberries
C. Cost of fertilizers for cranberry production
D. Development of a new pest control for cranberries
Answer: A
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When a central bank sells bonds, cash reserves throughout the financial system increase, interest rates fall, and investment spending increases
Indicate whether the statement is true or false
Refer to the diagram for the federal funds market. If the Fed supplies $200 billion in reserves, the equilibrium prime interest rate is:
A. 6.0 percent.
B. 5.5 percent.
C. 5.0 percent.
D. undeterminable with the information given.
In the Solow model, if productivity doesn't change,
A) the economy must eventually reach a steady state. B) the capital—labor ratio must decline. C) the capital—labor ratio must rise. D) there can be no saving.
Suppose that the production function for the economy is Y = AK0.2L0.8. If the capital stock = 40,000, the quantity of labor = 10,000, and the efficiency index = 1, real GDP is
A) $13,195.08. B) $16,000.00. C) $16,946.34. D) $28,000.00.