In the mathematical formulation of the short-run production function:
A) the quantity of output is usually assumed to be fixed.
B) the quantity of capital employed is usually assumed to be fixed.
C) the quantity of both labor and capital employed are usually assumed to be fixed.
D) the quantity of both labor and capital must be allowed to vary so that output can vary in the short run.
B
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An increase in the number of buyers in the market for LED TVs would cause the market demand curve for LED TVs to:
A) shift right. B) shift left. C) stay the same because market demand doesn't depend on the number of buyers. D) shift left or right depending on whether the new buyers purchase more or less than existing customers at each price.
Figure 4-14
Frustrated by the cost and ineffectiveness of the war on drugs, the U.S. government could consider "decriminalization" of the use and sale of cocaine. Critics contend that lower prices will expand drug use and that decriminalization will remove the stigma and danger from arrest associated with drug use, thus further increasing the demand and number of addicts. Which graph in Figure 4-14 best illustrates the critics' case?
a.
1
b.
2
c.
3
d.
4