Which of the following statements about cost functions is true?
a. Variable costs will always increase in direct proportion to the quantity of output produced.
b. The less capital equipment employed in the production process relative to labor and other inputs, the longer will be the period of time required to increase significantly the scale of operation.
c. The shape of the firm's long-run cost function is important in decisions to expand the scale of operations.
d. none of the above
c
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Trade between countries that is without restrictions is called
A) unencumbered trade. B) unabated trade. C) free trade. D) unobstructed commerce.
What is/are the central argument(s) against tariffs?
(a) They redistribute income away from consumers who are paying higher prices because of the tariffs. These rents are given to the individual industries that are protected by the tariffs and are operating inefficiently. (b) A laissez-faire economy is the American way. (c) They protect the wealthy. (d) They benefit only fast-growing industries.
Use the information in Scenario 4.2. At what price, if any, is the demand for artichokes completely elastic?
A) 50 B) 30 C) 10 D) 0 E) none of the above
When Goodyear increases its production when Michelin reduces its production, Goodyear is playing a
A) negative-sum game. B) cooperative game. C) non-cooperative game. D) reaction function game.