The investment required to maintain steady state growth
A) is impossible to achieve since capital for new workers requires continuous increases in s, the per capita savings ratio.
B) must equip new workers with capital equal to that employed by existing workers.
C) must replace "worn out" capital.
D) B and C.
D
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Using the figure as a guide, which of the following is FALSE with respect to profit maximization and the monopolist?
A) A monopolist (like any other firm) will select an output rate at which marginal revenue is equal to marginal cost, at the intersection of the marginal revenue curve and the marginal cost curve. B) The monopolist will produce quantity Qm and charge a price of Pm. C) When compared to a competitive situation, consumers pay a higher price to the monopolist, and consequently are forced to purchase more of a product as price varies directly with quantity demanded. D) Profits are the positive difference between total revenues and total costs.
Government imposed price controls often lead to
A) illegal trades of the good. B) the most efficient use of resources. C) the equilibrium solution in terms of price and quantity. D) maximization of profits.