Firms that sell information products experience relatively high fixed costs but, once they have produced the first unit, can
A) sell additional units at a loss, or above cost.
B) provide expensive information products to consumers.
C) sell additional units at a relatively low cost per unit.
D) experience short-run diseconomies of scale.
C
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An economy's total labor income is $2 trillion, and total capital income is $1 trillion. In the Cobb-Douglas production function, the exponent on capital is ________
A) two-thirds B) one-half C) one-third D) 0.3 E) none of the above
A unit tax
A) is based on the value of the good being sold. B) is a constant tax assessed on each unit of a good sold. C) is the primary tax studied in dynamic tax analysis. D) does not influence equilibrium price and quantity.
Real interest rates
a. cannot be negative. b. can be negative only if inflation is negative. c. can be negative only if inflation is zero. d. can be negative only if inflation is greater than zero.
An explanation for why the short-run aggregate supply curve is upward-sloping is because:
A. ?the quantity of real output supplied is inversely related to the aggregate supply curve. B. ?nominal incomes are fixed. C. ?the capital-output ratio is fixed. D. ?an increase in price will increase the marginal aggregate output.?