Explain how the "new growth theory" treats technology differently from the way economists used to treat technology
What will be an ideal response?
Technology used to be treated as an outside factor of growth that could not be explained itself. The new growth theory includes technology as another factor of production and argues that the greater the reward to technology the greater will be technological advance. Firms engage in research and development activity with the expectations of increasing their profitability.
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A law that prohibits certain kinds of market behavior such as monopoly and monopolistic practices is called ________
A) a consumer surplus law B) a trust law C) an antitrust law D) an anti-monopoly law
The average variable cost curve shifts downward if
A) there is a decrease in fixed costs. B) there is a technological advance. C) the cost of a variable input increases. D) the price of output decreases.