If there is inflation, then a firm that has kept its price fixed for some time will have a
a. high relative price. Relative-price variability rises as the inflation rate rises.
b. high relative price. Relative-price variability falls as the inflation rate rises.
c. low relative price. Relative-price variability rises as the inflation rate rises.
d. low relative price. Relative-price variability falls as the inflation rate rises.
c
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For a perfect competitor, price equals
A) marginal revenue only. B) average revenue only. C) both average revenue and marginal revenue. D) neither marginal revenue nor average revenue.
Import controls that can help a government maintain a fixed exchange rate, which if left to the foreign exchange market would depreciate, are
a. lowering tariffs and increasing quotas so that more international trade occurs b. raising tariffs and decreasing quotas so that its country's demand for foreign exchange decreases c. requiring exporters to turn over their foreign exchange to the government at a fixed exchange rate d. having the IMF loan the government enough foreign exchange to get through the crisis e. causing a devaluation of the nation's currency so that exports rise and imports fall
The North American Free Trade Agreement affects trade between
a. the United States, Cuba, and Brazil b. the United States, Canada, and Mexico c. the United States, Puerto Rico, and Cuba d. Brazil, Bolivia, Peru, and Columbia e. China and the United States
Regulating natural monopolies according to the "rate of return" criterion is likely to
a. reduce the incentive of firms to minimize cost. b. result in a smaller quantity of output than when the natural monopolist is unregulated. c. discourage the firms from investing resources in an effort to influence the decisions of the regulatory agency. d. increase the number of firms in the industry.