Suppose labor and capital are the only two resources used for production. In the long run:
a. both capital and labor can move freely between sectors.
b. only labor can move between sectors.
c. only capital can move between sectors.
d. both capital and labor are blocked from moving between sectors.
Answer: a. both capital and labor can move freely between sectors.
Economics
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The federal government, in order to fund expanded health care, imposes a lump-sum tax on all business property. Profit-maximizing firms that stay in business will respond by
a. raising prices to pay the tax. b. cutting output to reduce costs. c. lowering prices to stimulate demand. d. doing nothing.
Economics
Which of the following cities in NOT the location of a Federal Reserve Bank?
A. Salt Lake City B. Kansas City C. St. Louis D. San Francisco
Economics