What are the major issues that must be considered in measuring inputs for regression analysis of production functions?
What will be an ideal response?
How is labor to be measured? Can it be measured in hours, and if not, how can the labor actually used in production be expressed? How are materials to be measured? How are capital assets, which have different rates of depreciation and input intensity, to be measured?
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The aggregate expenditure (AE) curve
A) includes expenditures by domestic residents only. B) does not include expenditures on either imports or exports. C) includes expenditures on foreign as well as domestic goods. D) includes all expenditures on domestic goods. E) adds expenditures on imports because they are consumed in the nation and subtracts expenditures on exports because they are consumed abroad.
Refer to the table above. Diminishing marginal returns sets in when:
A) the second worker is hired. B) the fourth worker is hired. C) the fifth worker is hired. D) the seventh worker is hired.