If the price of an input decreases, each individual firm?s marginal cost curve shifts ________ and the industry supply curve ________.
A. downward; shifts to the left
B. downward; shifts to the right
C. up; shifts to the left
D. up; does not change
Answer: B
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What will be an ideal response?
An increase in ________ shifts the production function ________, and makes it possible to produce a higher level of GDP with ________ capital per hour worked
A) technology; down; the same amount of B) consumption; up; a lesser amount C) technology; up; the same amount of D) labor productivity; down; the same amount of
Refer to Figure 11.1. Assume the economy is in equilibrium at 1 = 0. Other things equal, a surge in household wealth will result in a movement from point ________ to point ________
A) A; B B) B; A C) A; C D) A; D
Excess capacity is defined as the difference between a firm's maximum possible output and its actual output
a. True b. False