For this question, assume that there are decreasing returns to capital, decreasing returns to labor, and constant returns to scale. Now suppose that both capital and labor decrease by 5%. Given this information, we know that output (Y) will
A) not change.
B) decrease by less than 5%.
C) decrease by 5%.
D) decrease by more than 5% but less than 10%.
E) none of the above
C
Economics
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If the money wage rate does not change, a decrease in the price level will ________ the real wage rate and ________ firms' profit
A) raise; increase B) lower; decrease C) lower; increase D) raise; decrease E) lower; not change
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At the expiration the premium of an option is equal to the option intrinsic value.
a. true b. false
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