When the Fed lowers the federal funds rate and the real interest rate falls, what happens to the opportunity cost of investment? What happens to investment?
What will be an ideal response?
The opportunity cost of investment is the real interest rate. When the Fed lowers the federal rate so that the real interest rate falls, the opportunity cost of investment decreases. In response, investment increases.
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In order for the government to collect taxes, the government must first establish a(n)
A) ad valorem taxation. B) tax base. C) philosophy of taxation. D) justice system.
A new hormone will increase the amount of milk each cow produces. If this hormone is adopted by many dairies, what will be the effect on the milk market?
a. an increase in supply, higher equilibrium price, and lower equilibrium quantity b. a decrease in supply, lower equilibrium price, and lower equilibrium quantity c. an increase in supply, lower equilibrium price, and higher equilibrium quantity d. an increase in supply, higher equilibrium price, and higher equilibrium quantity e. a decrease in supply, lower equilibrium price, and higher equilibrium quantity
The law of diminishing returns applies to which of the following segments of the marginal product of labor curve?
a. The entire curve. b. The downward-sloping segment only. c. The upward sloping segment only. d. The point where labor input is zero.
A matrix form is more likely to be found in organizations which:
a. produce one product and operate in a single market. b. produce many products and operate in a single market. c. produce one product and operate in multiple markets. d. produce many products and operate in multiple markets.