As output rises, marginal product eventually diminishes and
a. marginal cost increases
b. average cost falls
c. total cost falls
d. fixed cost is increasing
e. average product is negative
A
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In a closed economy, there should be a close positive relationship between
a. budget deficits and interest rates. b. trade deficits and budget deficits. c. savings and investment. d. investment and consumption. e. Both a and c.
Frozen Paws wants to prevent Happy Paws from entering the pet frozen treat market. If Frozen Paws expands its capacity, the expansion can lead to all of the following except which one?
A) increase Frozen Paws' profit-maximizing quantity B) decrease Frozen Paws' marginal cost C) increase Frozen Paws' profit-maximizing price D) decrease Happy Paws' profit from entering the market
The Happy Mountain Brewing Company sells ground organic coffee in one pound containers through several grocery chains in the US
The firm has two divisions: the roasting division buys raw organic coffee beans and then blends, roasts, and grinds the beans, and the merchandising division packages and distributes the ground coffee. a. Please draw a carefully labeled figure that illustrates the optimal transfer pricing policy for the firm if there is no outside market and the firm is a monopoly seller (i.e., there are no other sellers of ground organic coffee). In particular, please show the optimal transfer price that is paid to the roasting division, the optimal retail price charged by the merchandising division, and the optimal amount of coffee sold. b. Suppose poor weather conditions in South American increase the price of raw coffee beans. How does this affect the marginal cost curve for the roasting division? Does this also affect the marginal cost of merchandising (packaging and distribution)? How do the optimal transfer price, retail coffee price, and quantity sold change due to this weather problem?
In the Keynesian cross diagram, if the aggregate expenditure line intersects the 45-degree line at potential GDP, then the economy is in recession
a. True b. False Indicate whether the statement is true or false