The long-run average cost curve shows the lowest possible average cost for each output level, given that all inputs are variable.
Answer the following statement true (T) or false (F)
True
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Which of the following statements is NOT true regarding subsidies?
A. Subsidies are like taxes in that they create deadweight loss. B. Subsidies are like taxes in that they reduce sales of the subsidized good. C. Subsidies are unlike taxes in that they increase sales of the subsidized good. D. Subsidies are unlike taxes in that they reduce the price that buyers pay for a good.
When a country has flexible exchange rates the:
a. Reserves account must equal zero. b. Reserves account must be positive. c. Reserves account must be negative. d. Current account must equal minus the reserves account. e. Reserves account can be positive or negative.
If real disposable income fell during a particular year, we can conclude that:
a) personal taxes increased. b) inflation occurred. c) transfer payments declined. d) none of these necessarily occurred.
If there are only two goods in the economy, one whose price rises by 8 percent and one by 10 percent, it is possible that inflation is:
A. 2 percent. B. 9 percent. C. 10 percent. D. 8 percent.