Most economists today recognize that a short-run macro failure is possible.
Answer the following statement true (T) or false (F)
True
In the short run, the macro equilibrium could be below the full-employment level of output.
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The law of diminishing marginal returns states that
A) as both labor and capital are increased, output increases at a decreasing rate. B) output increases at a decreasing rate as more capital is added. C) output decreases at a constant rate as more capital is added. D) as both labor and capital are increased, output does not change. E) output increases at a constant rate as more capital is added.
An individual's labor supply curve will have a
A) positive slope if the income effect exceeds the substitution effect. B) negative slope if the substitution effect exceeds the income effect. C) positive slope if the substitution effect exceeds the income effect. D) negative slope regardless of whether the substitution effect or income effect is larger.