Suppose that the production function for the economy is Y = AK0.5L0.5. If the capital stock = 40,000, the quantity of labor = 10,000, and the efficiency index = 3, the equilibrium real rental price of capital is

A) $0.33.
B) $0.75.
C) $1.00.
D) $2.22.


B

Economics

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At a given interest rate, the investment function shows

A. how much businesses will spend on the capital stock. B. how many funds people will invest in the stock market. C. how profitable it will be for firms to expand. D. how many funds people will earn on their stock market investments.

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A rational decision maker takes an action if and only if the marginal benefit exceeds the marginal cost

a. True b. False Indicate whether the statement is true or false

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Which of the following countries had the highest fertility rate in 2012?

A. Japan B. China C. Germany D. The United States

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Classical economists believed that production could be stuck below its full employment level for a long period of time

a. True b. False

Economics