In recent years, Taiwan has experienced increases in savings and investment. As a result of the higher investment and saving, we expect
i. increases in physical capital.
ii. increases in the inflation rate.
iii. advances in technology.
A) i, ii and iii B) ii and iii C) ii only D) i and iii E) i and ii
D
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Which of the following best explains how an economy could simultaneously experience high inflation and high unemployment?
A) The government increases spending without increasing taxes B) The government increase taxes without increasing spending C) Inflationary expectations decline D) Women and teenagers stay out of the labor force E) Negative supply shocks cause factor prices to increase
Refer to Figure 11-13. The lines shown in the diagram are isocost lines. If the price of labor is $50 per unit, what is the price of capital along the isocost CE?
A) $400 per unit B) $100 per unit C) $25 per unit D) insufficient information to answer question