If marginal cost is greater than average variable cost, average variable cost will:
A. increase as output increases.
B. equal average total cost.
C. not change as output increases.
D. decrease as output increases.
Answer: A
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Economists James Buchanan and Gordon Tullock are well-known for developing
A) the concept of government failure. B) the voting paradox. C) the impossibility theorem. D) the public choice model.
Which of the following assumptions made in deriving the simple deposit multiplier is unrealistic?
A) The Fed sets the required reserve ratio. B) The Fed is able to affect the level of reserves in the banking system. C) Banks loan out all of their excess reserves. D) The simple deposit multiplier is equal to 1 divided by the required reserve ratio.
If the opportunity cost of producing wheat in Canada is four buffalo and the opportunity cost of producing wheat in the U.S. is seven sheep then we know that
a. four buffalo must trade for seven sheep b. seven buffalo must trade for three sheep c. we have insufficient information to determine anything about their trade d. the U.S. should specialize in wheat e. Canada should specialize in wheat
Why does economics fit well as a liberal arts education?
What will be an ideal response?