Marginal cost
A. Rises as a direct result of diminishing returns.
B. Rises whenever marginal revenue product rises.
C. Falls in the short run because some resources are fixed.
D. Falls whenever marginal physical product decreases.
Answer: A
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If a nation is running a trade deficit, it is
a. spending more on public services than it is raising in tax revenues. b. worse off as the result of its trade with foreign countries. c. importing more goods and services than it exports. d. encountering a balance of payments disequilibrium.
When quantity demanded decreases at every possible price, the demand curve has
a. shifted to the left. b. shifted to the right. c. not shifted; rather, we have moved along the demand curve to a new point on the same curve. d. not shifted; rather, the demand curve has become flatter.
These are the cost and revenue curves associated with a firm.
If the firm in the given graph were to produce Q1 and charge P3, the area A would represent:
A. producer surplus. B. deadweight loss. C. consumer surplus. D. profits.
In its role as the bankers' bank, a central bank performs each of the following, except:
A. providing deposit insurance. B. managing the payments system. C. overseeing commercial banks and the financial system. D. providing loans during times of financial distress.