Technological innovation is not subject to diminishing marginal returns because:
a. it can be used by workers across the economy at a low marginal cost
b. it can result in a rightward shift of the aggregate production function of an economy.
c. it can result in a rightward shift of the production possibilities frontier of an economy.
d. it can be used by skilled as well as unskilled workers across the economy.
a
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According to the Application, the average cost of abating one ton of CO2 emissions through the hybrid subsidy is $177, but a switch from coal to natural gas in power plants would reduce CO2 emissions at less than one-third the cost of the hybrid
subsidy. The increase in cost associated with the reduction of one ton of CO2 emissions (assuming that each unit of CO2 emissions is measured in tons) describes the economic concept of A) marginal thinking. B) rational self interest. C) using assumptions to simplify. D) ceteris paribus.
If government expenditure on goods and services increase by $100 billion, then aggregate demand
A) increases by $100 billion. B) increases by less than $100 billion. C) increases by more than $100 billion. D) remains unchanged. E) decreases by more than $100 billion.