Allison's Auto Art is a company that applies pinstripes to vehicles. Allison's cost for a basic 1-color pinstriping job is $35, and she charges $95 for this service. For a total price of $175, Allison will apply a fancier 3-color pinstripe application to
an automobile, a service that adds an additional $40 to the total cost of the package. What is Allison's marginal benefit if she sells a basic 1-color job?
A) $35
B) $60
C) $95
D) The marginal benefit cannot be determined.
Answer: C
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A change in which of the following changes the supply of dollars and shifts the supply curve of dollars?
I. an increase in the exchange rate II. a change in interest rates III. a decrease in the expected future exchange rate A) I B) I and II C) II and III D) I, II, and III
The perfectly competitive firm faces
A) a downward sloping demand curve. B) a horizontal supply function. C) perfectly elastic demand. D) constant marginal costs.
The long-run average total cost curve is always
a. flatter than the short-run average total cost curve, but not necessarily horizontal. b. horizontal. c. falling as output increases. d. rising as output increases.
All economies must make decisions concerning what to produce, how to produce it, and for whom to produce.
Answer the following statement true (T) or false (F)