The figure above shows the demand and marginal revenue curves facing Sue's Surfboards, the sole renter of surfboards on Big Wave Island. If Sue is renting 25 surfboards an hour so that the marginal revenue is negative, then Sue's Surfboards
A) can increase its profit by increasing the number of rentals.
B) must face an inelastic demand for surfboard rentals.
C) must face a unit elastic demand for surfboard rentals.
D) must face an elastic demand for surfboard rentals.
B
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Suppose the United States initially has a trade deficit. Then U.S. firms increase their imports from Canada, financing that increase by borrowing from Canada
The current account deficit is now ________ and the capital and financial account surplus is now ________. A) larger; larger B) larger; smaller C) smaller; larger D) smaller; smaller
What is the present value of $1,000 to be received 2 years in the future with an interest rate of 8 percent?
A) $857.34 B) $925.93 C) $1080.00 D) $1166.40
Hyperinflation occurs when
A) the inflation rate rises. B) the inflation rate declines. C) the inflation rate is extremely high. D) the inflation rate is extremely low.
If a firm is experiencing diseconomies of scale, then
A. proportional increases in all inputs result in proportional increases in output. B. the firm should expand the size of its operation. C. the long-run average cost curve is decreasing as output expands. D. the long-run average cost curve is rising as output expands.