A farmer uses M units of machinery and L hours of labor to produce C tons of corn, with the following production function C = L0.5M0.75. This production function exhibits
A) decreasing returns to scale for all output levels
B) constant returns to scale for all output levels
C) increasing returns to scale for all output levels
D) no clear pattern of returns to scale
C
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The interest-rate-based approach to the monetary policy transmission mechanism says that a change in the money supply influences aggregate demand by
A) a change in interest rates, which changes investment. B) a change in interest rates, which changes the money supply. C) leading to shifts of the short-run aggregate supply curve. D) changing consumer consumption behavior as they adjust to a change in the number of dollars available.
Under the Global Legal Settlement of 2002, the provision that requires, for a period of five years, brokerage firms to contract with independent research firms to provide information to their customers is an example of
A) regulate for transparency. B) supervisory oversight. C) separation of functions. D) socialization of information production.