An exterior painting company is contemplating buying a bigger truck and ladder. This is a
a. bad decision because average costs will be higher
b. good decision because average costs will be lower
c. long-run decision
d. short-run decision
e. bad decision because more fuel will be needed
C
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Banks do not need to keep all of their deposits on hand as reserves because
A) only a fraction of deposits are withdrawn at any one time. B) FDIC protects banks from excessive withdrawal demands. C) there is too much risk of bank robberies. D) they can always generate new reserves through the money creation process.
Recovery from the 1990-91 recession occurred because wages fell and the aggregate supply curve shifted downward
a. True b. False
Two firms compete as a Stackelberg duopoly. The demand they face is P = 100 ? 3Q. The cost function for each firm is C(Q) = 4Q. The outputs of the two firms are:
A. QL = 16; QF = 8. B. QL = 12; QF = 8. C. QL = 24; QF = 12. D. QL = 20; QF = 15.
A perfectly competitive system is efficient.
Answer the following statement true (T) or false (F)