The interest rate effect explains that higher prices
a. make it more expensive to borrow, leading to higher interest rates and less investment
b. make people worse off by reducing the value of their wealth, leading them to save more and spend less
c. decrease borrowing, leading to higher interest rates and less investment
d. decrease borrowing, leading to lower interest rates and more investment
e. increase borrowing, leading to higher interest rates and less investment
E
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Average fixed cost:
a. remains unchanged as output expands b. is defined as the change in total cost divided by the change in output. c. always increases as output increases. d. always decreases as output expands.
Which of the following is not true about the demand curve for labor of a competitive firm? a. As the wage rate the firm pays decreases, the quantity of labor it demands (employs) increases
b. It shows how much labor the firm is willing to employ at different wage rates. c. It is identical to the marginal revenue product curve of labor. d. The wage rate exceeds the workers' opportunity costs. e. It is downward sloping.