a production function relates
A) the level of output to the level of technology
B) the price level to the level of aggregate output
C) aggregate output to the levels of inputs and
technology
D) aggregate output to the profit maximizing levels of inputs correct answers C) aggregate output...
UKY ECO 402 exam 1 || with Error-free Solutions.
a production function relates
A) the level of output to the level of technology
B) the price level to the level of aggregate output
C) aggregate output to the levels of inputs and
technology
D) aggregate output to the profit maximizing levels of inputs correct answers C) aggregate
output to the levels of inputs and technology
A decrease in the money supply will shift the money supply curve to the_______ causing the
nominal interest rate to______
A) left increase
B) left: decrease
C) right: increase
D) right: decrease correct answers A) left, increase
The relationship among interest rates on bonds that are otherwise similar but that have different
maturities is known as:
A) the risk structure of interest rates.
B) term structure of interest rates
C) Term premium
D) Treasury bond coupon correct answers B) term structure of interest rates
When the Fed pursues a monetary policy of low interest rates, the exchange rate between the
dollar and other currencies will tend to______,generally making it________ for foreign firms to
sell their goods in the United States.
A) rise; easier
B) rise: more difficult
C) fall; easier
D) fall; more difficult correct answers D) fall; more difficult
lf the dollar appreciates relative to the Swiss franc,
A) US. exports to Switzerland become more expensive for swiss citizens.
B) US. exports to Switzerland become less expensive for Swiss citizens.
C) Swiss imports to the United States become more expensive for U.S. citizens.
D)The value of Swiss imports to the United States does not change since the lower price is
exactly offset by the rise in quantities. correct answers A) US. exports to Switzerland become
more expensive for swiss citizens.
the exchange rate changes from$$1.52=£1.00 to $1.65 to £1.00, then relative to each other,
A) both the dollar and the British pound have appreciated.
B) both the dollar and the British pound have depreciated.
C)the dollar has appreciated and the British pound has depreciated.
D) the dollar has depreciated and the British pound has appreciated correct answers D) the dollar
has depreciated and the British pound has appreciated
, 7. An increase in real GDP will shift the money demand curve to the causing the nominal interest
rate to
A) right decrease
B) right increase
C) left, increase
D) left, decrease correct answers B) right increase
Diminishing marginal returns refers to the fact that
A) holding other inputs constant, each additional increase in labor leads to successively smaller
but still positive changes in output.
B) holding other inputs constant, additional increases in labor lead to lower output.
C)additional increases in labor always lead to smaller changes in output.
D) the marginal returns to labor fall as the quantity of capital rises. opportunity cost of holding
money wi increase, the correct answers A) holding other inputs constant, each additional
increase in labor leads to successively smaller but still positive changes in output.
When nominal interest rates increase, the opportunity cost of holding money will________ and
the quantity of money demanded by households and firms will______
A) increase; increase
B) increase; decrease
C) decrease; increase
D) decrease; decrease correct answers B) increase; decrease
A positive shock to the aggregate production function that raises the marginal product of labor:
A) shifts the labor demand curve outward.
B) shifts the labor demand curve inward.
C) has no impact on the position of the labor demand curve since neither W nor P is specified to
have changed, though MPL does shift upward.
D) will raise the marginal cost of production at the initial level of labor usage correct answers A)
shifts the labor demand curve outward.
11. In the relevant range, the marginal product of labor is always_______ and______as the
quantity of labor increases.
A) negative; increases
B) negative; decreases
C) positive; increases
D) positive; decreases correct answers D) positive; decreases
12. A firm that wishes to maximize profits will continue to hire labor until the
A) real wage= MPL.
B) nominal wage= MPL.
C) nominal wage= the real wage
D) nominal wage= the price level. correct answers A) real wage= MPL.
13. Which of the following equations best represents a Cobb-Douglas production function?
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