Which of the following is a property of an isoquant?
a. It is concave to the origin.
b. Its slope is given by the ratio of the marginal products, for example, (marginal product of capital) รท (marginal product of labor), where capital and labor are measured on the Y and X-axes respectively.
c. It gives the lowest-cost way of producing a certain level of output.
d. Isoquants cannot intersect each other.
D
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Exhibit 2-18 Production possibilities curves
In Exhibit 2-18, the production possibilities curves for a country are shown for the years Year X and Year Y. Suppose this country was located at point A in Year X and point B in Year Y. This economy:
A. is worse off in Year Y than in Year X. B. has stagnated production in this two year period. C. is more efficient in Year Y than in Year X. D. has shown growth between these two years.
Which of these statements about fiscal policy is correct?
A. Fiscal restraint is implemented when the economy is experiencing high unemployment. B. Fiscal stimulus is implemented when the economy is experiencing high inflation. C. The goal of fiscal policy is to match aggregate demand with full employment potential. D. All of these statements are correc