Suppose that M doubles and PQ remains the same. In that case we know that V

High levels of sales that spur high levels of investment spending is an example of a

a. vicious circle. b. virtuous circle. c. convergence circle. d. divergence circle.

As a firm expands output, in the short run marginal costs will

a. always decline as output expands. b. increase at first but eventually level off and decline. c. eventually increase as the firm experiences diminishing returns to the fixed factors of production. d. initially increase at a decreasing rate but eventually increase at an increasing rate.