When carmakers began to cut costs of producing cars by designing the chassis, engines, and transmissions so that different models could be produced on the same assembly line, production costs fell $240 per car. This change caused car makers' short-run average cost curves to:
A. remain unchanged, though there was a movement along the short-run average cost curve.
B. shift down.
C. remain unchanged; only the long-run average cost curve was affected.
D. shift up.
Answer: B
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If average fixed costs equal $60 and average total costs equal $120 when output is 100, the total variable cost must be
a. $40. b. $60. c. $6,000. d. $8,000.
Figure 14-2
If the Fed anticipates that the conditions illustrated by AD2 and SRAS in will be present in the near future, it should
a.
decrease the discount rate.
b.
reduce reserve requirements.
c.
sell U.S. treasury bonds on the open market.
d.
buy U.S. treasury bonds on the open market.
In Europe, in 2005, Microsoft was penalized for______.
a. unfair labor practices b. price discrimination c. false advertising d. bundling products
Which of the following would lead to an increase in bond supply?
A. An increase in corporate taxes. B. A decrease in expected inflation. C. An improvement in general business conditions. D. A decrease in government spending relative to revenue.