The law of diminishing marginal returns states that
a. long-run average cost declines as output increases
b. if the marginal product is above the average product, the average will rise
c. as units of a variable input are added to a given amount of fixed inputs, the marginal product of the variable input eventually diminishes
d. as a person consumes more of a good, the marginal satisfaction from that good eventually diminishes
e. if marginal product is positive, total product rises
C
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If employees and employers always accurately forecast inflation, what is the shape of the Phillips curve?
a. It is vertical in the short run, and upward sloping in the long run. b. It is downward sloping in the short run, and vertical in the long run. c. It is upward sloping in the short run, and horizontal in the long run. d. It is vertical in the short run and long run.
People are likely to want to hold more money if the interest rate
a. increases making the opportunity cost of holding money rise. b. increases making the opportunity cost of holding money fall. c. decreases making the opportunity cost of holding money rise. d. decreases making the opportunity cost of holding money fall.