If we are trying to maximize economic efficiency, which one of the following statements is true?
a. Reducing current consumption to save some resources for the future may be optimal
b. Maximizing current consumption is optimal
c. Consumption should always be divided equally among time periods
d. Consumption rates should rise at a rate equal to the rate of interest
e. Consumption rates in a time period are not related to interest rates
Answer: a. Reducing current consumption to save some resources for the future may be optimal
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As time passes, the price of cranberries ________ and the initial firms' economic ________. A) falls; profit will be eliminated B) rises still higher; loss will be eliminated C) rises still higher; profit will not change D) falls; loss will be increased E) falls; profit will not change
When the marginal product of labor rises
A) the marginal cost of production will exceed the average total cost. B) the marginal cost of production also rises. C) the average total cost of production also rises. D) the marginal cost of production falls.