Question

In: Economics

1) One reason that technological ideas do not seem to run into diminishing returns is because...

1)

One reason that technological ideas do not seem to run into diminishing returns is because ______________.

Select the correct answer below:

technology advances more quickly than other factors of production

technology increases levels of employment throughout the economy

many workers across the economy can use a new technology or invention at very low marginal cost

all of the above

2)

A(n) _____________ production function describes a firm's, or perhaps an industry's, inputs and outputs.

Select the correct answer below:

macroeconomic

microeconomic

relative

minor

3)

Compared to several decades ago, the U.S. economy now has _______________.

Select the two correct answers below.

Select all that apply:

  • near zero percent unemployment

  • better-educated workers

  • greater employment opportunities for individuals

  • workers with access to better technologies

  • 4)

  • In the pattern of recessions and expansions in the economy, we call the highest point of the economy, before the recession begins, the ________.

    Select the correct answer below:

    maximum

    minimum

    peak

    trough

  • 5)

  • Suppose that nominal GDP increases to $30,000, and the GDP deflator increases to 108. What is real GDP? Round your answer to the nearest cent.

Solutions

Expert Solution

Answer 1:

Option A. One reason that technological ideas do not seem to run into diminishing returns is because technology advances more quickly than other factors of production. Improvement in technology shifts the production function upwards and this increases the overall level of output produced in the economy.

Answer 2:

Option B. A micro economic production function describes a firm's or perhaps an industry's inputs and outputs. It shows the relationship between the inputs and output of the firm.

Answer 3:

Option C and option D. Compared to several decades ago, the U.S. economy now has greater employment opportunities for individuals and also workers with access to better technologies.

Answer 4:

Option C. The highest point of the economy before the recession begins is known as Peak.

Answer 5:

GDP Deflator = Nominal GDP / Real GDP * 100, Thus using above figures

Thus, Real GDP =$ 27,777.78


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