The nation of Futura has an actual capital-labor ratio which is in steady state. Futura will experience
A) no growth from convergence and the economy will remain on its balanced growth path.
B) positive growth from convergence to keep the economy on its balanced growth path.
C) positive growth from convergence, but the growth will be less than the balanced growth rate in order to remain on its balanced growth path.
D) negative growth from convergence to offset the increase in the balanced growth rate in order to remain on its balanced growth path.
A
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In the short run, a firm can minimize its total costs of production by operating at the minimum of its average total cost curve
Indicate whether the statement is true or false
A horizontal LM curve implies that the expenditure multiplier, when compared with the simple Keynesian expenditure multiplier, is
A) smaller. B) larger. C) equal. D) equal to the inverse of the simple multiplier.