Which of the following describes how output changes in the short run? Because of specialization and the division of labor, as more workers are hired
A) output will first decrease at an increasing rate, then increase at a decreasing rate.
B) the marginal product of labor will first be negative and then will be positive.
C) output will first increase at an increasing rate, then output will increase at a decreasing rate.
D) the marginal product of labor will first decrease, then increase at a decreasing rate.
C
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In the above figure, the short-run aggregate supply curve is SAS and the aggregate demand curve is AD. A recessionary gap exists
A) if the long-run aggregate supply curve is LAS1. B) if the long-run aggregate supply curve is LAS2. C) if the long-run aggregate supply curve is LAS3. D) All of the above answers are correct.
Under a system of marketable pollution permits:
A. firms can trade away their right to pollute. B. the amount of pollution an individual firm can generate is determined by the number of permits issued to it by the government. C. the production costs for firms are not affected. D. the government controls the production process of firms who pollute.