In which industry or sector of the economy is output least likely to be affected by the business cycle?
A. Capital goods production
B. Agricultural commodities
C. Automobile production
D. Housing construction
Answer: B
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Under a fixed exchange rate system, if the inflation rate in the United States is 5 percent a year and the inflation rate in Australia is 0 percent a year, then the U.S. real exchange rate will
A) increase 5 percent a year. B) decrease 5 percent a year. C) remain constant. D) possibly increase or decrease.
What is a firm's balance sheet?
What will be an ideal response?
This graph represents the cost and revenue curves of a firm in a perfectly competitive market.
According to the graph shown, if a firm is producing at Q1:
A. the firm should not increase production because it will earn loss. B. average total costs exceed the market price. C. marginal revenue is greater than average total cost. D. profits are being maximized.
The effects of a recession on auto companies are that ________ cars are demanded and prices generally __________.
A. fewer; fall B. more; fall C. fewer; rise D. more; rise