Gold mining and the supply of gold depends not only on its price but also on the market rate of interest

Suppose that capital and labor must be kept in a fixed proportion to produce a particular good. For example, digging a trench requires one worker who has one shovel. What does this imply about returns to scale?

A) There are constant returns to scale. B) There are increasing returns to scale. C) There are decreasing returns to scale. D) Nothing.

Because markets may not clear for several months or even several years, the classical model

a. is no longer considered valuable by mainstream economists b. has no value when explaining a situation where excess supply exists c. is irrelevant to any discussion of a market in which excess demand exists d. does a better job of explaining short-term fluctuations than long-run growth e. does a better job of explaining long-run growth than short-run fluctuations