If the capital stock decreases, then the economy will produce ____ output with the ____ amount of labor.
A. same, same
B. less, same
C. more, same
D. more, decreased
Answer: B
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The slope of a demand curve is not used to measure the price elasticity of demand because
A) the slope of a linear demand curve is not constant. B) the measurement of slope is sensitive to the units chosen for price and quantity. C) the slope of a line cannot have a negative value. D) the slope of the demand curve does not tell us how much quantity changes as price changes.
In a study published in 1963, Milton Friedman and Anna Schwartz found that in every business cycle they studied over nearly a hundred-year period
A) the growth rate of the money supply decreased before output decreased. B) interest rates decreased before output decreased. C) the growth rate of federal government spending decreased before output decreased. D) the growth rate of state and local government spending decreased before output decreased.