How does simultaneous consumption affect economies of scale?
What will be an ideal response?
Simultaneous (or nonreligious) consumption is a situation where a product can satisfy a large number of consumers at the same time. For example, once software is created for one customer the producer can provide it to another customer or to a million customers at essentially the same marginal cost. As the number of users increases, however, average total cost falls and the firm achieves greater economies of scale.
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In the second half of the 1990s a rapidly growing movement focused on the harm caused by international trade to
A) land owners in poor countries. B) capital owners in rich industrialized countries. C) land owners in rich industrialized countries. D) production workers in both rich and poor countries. E) terms of trade in developing countries.
A contractionary monetary policy can reduce real GDP if expectations are formed rationally and monetary policy is
A) combined with expansionary fiscal policy. B) carried out in total secrecy. C) publicly announced and credible. D) combined with contractionary fiscal policy.
An example of a market failure is
A) a firm is dumping toxic waste that is making people sick. B) when not everyone who wants to see a major league football game can. C) when there is an increase in demand and a shortage develops. D) unemployment.
Assume an Australian importer expects to pay 16,000 Australian dollars (AUD) for $8,000 worth of U.S. goods, but on the shipment date 30 days later, the same volume of U.S. goods costs the Australian importer only 10,000 Australian dollars. This means that between the contract date and the payment date, the exchange rate has changed:
a. from $1 = 1.25 AUD to $1 = 2.0 AUD. b. from $1 = 2.0 AUD to $1 = 1.25 AUD. c. from $1 = 0.8 AUD to $1 = 0.5 AUD. d. from $1 = 0.5 AUD to $1 = 0.8 AUD. e. from $1 = 0.5 AUD to $1 = 2.0 AUD.