Economists often treat the economy's capital stock as fixed because
A) labor is a more important factor of production than capital, so economists ignore capital.
B) it takes a long time for new investment and the scrapping of old capital to affect the overall quantity of capital.
C) there is very little capital in the economy compared with the amount of labor.
D) unless the interest rate changes, the capital stock doesn't change.
B
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The money supply consists of
A) currency alone. B) currency and checking accounts. C) checking and savings accounts. D) currency and checking and savings accounts. E) checking accounts alone.
In the quantity equation framework for understanding the determinants of long-run inflation, a rise in government spending ________ velocity, putting ________ pressure on inflation
A) raises, upward B) raises, downward C) lowers, upward D) lowers, downward