Purchasing a profitable supplier increases profits only if
a. You pay equal to the company's discounted future profits
b. You pay higher than the company's discounted future profits
c. You pay lower than the company's discounted future profits
d. None of the above
c
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A bank faces a required reserve ratio of 5 percent. If the bank has $200 million of checkable deposits and $15 million of total reserves, then how large are the bank's excess reserves?
Diseconomies of scale definitely means that as the firm increases its output, its
A) long-run average total cost increases. B) long-run average total cost decreases. C) short-run average total cost increases. D) short-run average total cost decreases.
When very few substitutes for a good exist, demand will be
A) elastic. B) unit-elastic. C) inelastic. D) perfectly elastic.
The Pennsylvania Turnpike is a tolled freeway running through the state of Pennsylvania. Motorists must pay tolls at various points along the Turnpike based on the distance they traveled on the freeway. Suppose that despite the tolls, many motorists in the urban areas use the Turnpike causing traffic to slow during peak times. What type of good would the Turnpike be classified as in this case?
a. private good b. club good c. common resource d. public good