The marginal rate of technical substitution is
A) the rate at which a firm is able to institute positive technological changes to its production process.
B) the rate at which a firm is able to increase its output by replacing labor with technology.
C) the rate at which a firm is able to substitute one input for another, while keeping the level of output constant.
D) the rate at which a firm is able to substitute one input for another, while keeping total cost constant.
C
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If a change in government spending causes "crowding in" in an open economy, which of the following might increase in addition to consumption and investment?
A) unemployment B) net exports C) supply and demand D) stock of capital
The supply-side economists expect that a cut in the marginal income tax rate, with lost revenues made up by a cut in government spending, would
a. increase output. b. decrease output. c. leave output unchanged. d. affect output but the direction of the effect is uncertain.