While the classicists believed that both velocity and output are stable, Keynesians believe:
A. velocity is stable and output is variable.
B. velocity and output are both variable.
C. output is stable and velocity is variable
D. the same as the classical economists that both output and velocity are stable
Answer: B
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Assuming that w and r are both positive, if the long-run expansion path is horizontal, then
A) = 0. B) MRTS is a function of capital only. C) w = r. D) All of the above.
If the market price ever drops below a firm's average variable costs at its profit-maximizing level of output the:
A. firm should shut down immediately. B. loss-minimizing quantity of output is zero. C. firm is not earning enough revenue to cover the variable costs of production. D. All of these are true.
Which of the following is responsible for the Fed's daily activity in financial markets?
A. The Board of Governors. B. Bank of America. C. The House of Representatives Ways and Means Committee. D. The FOMC.
The concept of equity pertains to the fairness of a tax.
Answer the following statement true (T) or false (F)