One reason that economists encourage free trade is that
A) it encourages a more rapid spread of technology.
B) it allows us to exploit the workers of less developed countries.
C) we can sell more goods.
D) it increases our capital stock.
A
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The law of diminishing marginal productivity states that
a. As you expand output, your marginal productivity eventually increases b. As you expand output, your marginal productivity eventually declines c. As you expand output, the total product eventually increases d. None of the above
Predatory pricing can be avoided by requiring that firms not price below average variable cost
Indicate whether the statement is true or false
A problem with using the price of a product similar to the intermediate good sold on the market is
a. the market price includes a margin above marginal cost b. the product on the market may include costly features your downstream division does not use c. the product on the market may be cheap because it is not as high of quality as your downstream division uses d. all of the above
If the percent change in nominal GDP is 6 percent and the percent change in real GDP is 2 percent, inflation is:
A. 4 percent. B. 2 percent. C. 0 percent. D. 6 percent.