In economics, short run is defined as?
a. A period of time less than a year.
b. A period of time during which at least one production input is fixed.
c. A period of time less than one month.
d. A period of time during which all production inputs are fixed.
e. A period of time during which all production inputs are variable. (is correct in long-run)
b. A period of time during which at least one production input is fixed.
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Developing countries are damaged by dead capital because
A) it replaces too many workers, creating unemployment. B) resulting inefficiencies greatly reduce the rate of return on investment. C) it must be sold as scrap. D) none of the above.
If government spending increased by $100 billion and the MPS within the economy was 0.25, what would be the total impact on real GDP?
a. $25 billion increase b. $75 billion increase c. $133 billion increase d. $400 billion increase