A decrease in Swiss interest rates will cause:
A. an increase in the demand for U.S. dollars and an increase in the exchange rate of Swiss francs per dollar.
B. a decrease in the demand for U.S. dollars and a decrease in the exchange rate of Swiss francs per dollar.
C. an increase in the supply of U.S. dollars and a decrease in the exchange rate of Swiss francs per dollar.
D. a decrease in the supply of U.S. dollars and an increase in the exchange rate of Swiss francs per dollar.
Answer: D
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Tommy spends most of his monthly budget on $3 video game rentals or $6 packets of baseball cards. The opportunity cost to Tommy of an extra packet of baseball cards is
A. one video game rental. B. two video game rentals. C. the cost of the baseball cards. D. he does not incur an opportunity cost.
The horizontal demand curve facing an individual firm in a perfectly competitive market: a. violates the law of demand, which states that demand curves slope downward. b. is a reflection of the firm's small size relative to the total market
c. is maintained only with the help of high barriers to entry. d. is a reflection of the inelastic demand for its product.
Having a well-known brand name associated with high quality is
A. can take a long time to establish. B. is a value to consumers. C. can be costly to maintain. D. All of these statements are true.
A price-setting firm faces the following estimated demand and average variable cost functions:Qd = 800,000 - 2,000P + 0.7M + 4,000PRAVC = 500 - 0.03Q + 0.000001Q2where Qd is the quantity demanded, P is price, M is income, and PR is the price of a related good. The firm expects income to be $40,000 and PR to be $53. Total fixed cost is $2,600,000. What price should the firm charge in order to maximize profit?
A. $510 B. $420 C. $445 D. $400 E. $356