When the absolute price elasticity of demand is greater than 1, demand is

The level of the capital—labor ratio that maximizes consumption per worker in the steady state is known as the

A) Solow residual capital—labor ratio. B) Golden Rule capital—labor ratio. C) q theory capital—labor ratio. D) dynamically efficient capital—labor ratio.

Assume that the central bank purchases government securities in the open market. If the nation has highly mobile international capital markets and a flexible exchange rate system, what happens to the real GDP and net nonreserve-related international borrowing/lending in the context of the Three-Sector-Model?

a. There is not enough information to determine what happens to these two macroeconomic variables. b. Real GDP falls, and net nonreserve-related international borrowing/lending becomes more positive (or less negative). c. Real GDP rises, and net nonreserve-related international borrowing/lending becomes more positive (or less negative). d. Real GDP rises, and net nonreserve-related international borrowing/lending becomes more negative (or less positive). e. Real GDP and net nonreserve-related international borrowing/lending remain the same.