Diseconomies of scale exist for all of the following reasons except:
a. bureaucratic inefficiencies.
b. management problems.
c. failures in information flows.
d. firm size is too small.
e. organizational problems.
d
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When a local grocery store offers discount coupons in the Sunday paper it is most likely trying to
a. reduce prices for all customers. b. encourage literacy. c. encourage arbitrage. d. price discriminate.
A bilateral monopoly is a market in which there are:
A. many sellers and many buyers. B. many buyers but only a single seller. C. many sellers but only a single buyer. D. only a single seller and a single buyer.
Assume that policy makers are pursuing a fixed exchange rate regime. Assume that the economy is initially operating at the natural level (i.e., Y = Yn). Suppose fiscal policy makers increase government spending. This fiscal contraction will cause which of the following?
A) The real exchange rate will be permanently higher in the medium run. B) The real exchange rate will be permanently lower in the medium run. C) The effects of this devaluation on the real exchange rate will be ambiguous in the medium run. D) The real exchange rate will be unchanged in the medium run. E) none of the above
If an economist observed that higher hot dog prices lead to a decrease in the demand for chili, she most likely would conclude that:
A. chili and hot dogs are both inferior goods. B. chili and hot dogs are substitutes. C. chili and hot dogs are complements. D. chili and hot dogs are both normal goods.