Which of the following will occur when the capital stock increases?
A) profit per unit of capital will increase
B) profit per unit of capital will decrease
C) there will be no change in profit per unit of capital
D) there will be an ambiguous effect on profit per unit of capital
E) none of the above
B
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________ increases with education, training, and job experience
i. Physical capital ii. Human capital iii. Financial capital A) i only B) ii only C) iii only D) both ii and iii E) i, ii, and iii
Suppose total government spending is increased permanently by ten percent, with no change in tax rates. In the long run, the resulting deficit will disappear, ________
A) only if government spending is brought back down to the original level B) if economic growth raises tax revenue by ten percent C) if the government debt is sold to foreigners D) unless the money is spent entirely on government consumption