The long run is
A) over one year.
B) over five years.
C) when all factors of production are fixed.
D) the time period in which all factors of production can be varied.
Answer: D
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When estimating a demand function for a good where quantity demanded is a linear function of the price, you should
A) not include an intercept because the price of the good is never zero. B) use a one-sided alternative hypothesis to check the influence of price on quantity. C) use a two-sided alternative hypothesis to check the influence of price on quantity. D) reject the idea that price determines demand unless the coefficient is at least 1.96.
The strength of the competition faced by a company can profoundly affect its
A. pricing. B. output decisions. C. input decisions. D. All of the responses are correct.
Which type of unemployment is most likely to fall as a result of government policies that stimulate aggregate demand?
a. frictional unemployment b. structural unemployment c. natural unemployment d. cyclical unemployment
Exclusion of a relevant variable from a multiple linear regression model leads to the problem of _____.
A. misspecification of the model B. multicollinearity C. perfect collinearity D. homoskedasticity