Refer to the information provided in Table 8.6 below to answer the question(s) that follow.
Table 8.6
Refer to Table 8.6. From the information in the given table,
A. the marginal cost curve intersects the average total cost curve between 3 and 4 units of output.
B. the firm is in the long run.
C. the difference between total cost and total variable cost decreases as output increases.
D. the firm eventually experiences diminishing returns to its variable input.
Answer: D
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Suppose Cathy and Lewis work in a bakery making pies and cakes. Suppose it takes Cathy 1.5 hours to make a pie and 1 hour to make a cake, and suppose it takes Lewis 2 hours to make a pie and 1.5 hours to make a cake. Which of the following statements is correct?
A. Cathy has a comparative and absolute advantage in pies. B. Cathy has a comparative advantage in pies, and Lewis has an absolute advantage in pies. C. Lewis has a comparative and absolute advantage in pies. D. Lewis has a comparative advantage in pies, and Cathy has an absolute advantage in pies.
An exchange rate that varies according to supply and demand for the currency in the foreign exchange market is called a ________ exchange rate.
A. flexible B. nominal C. real D. fixed
________ refers to the reduction in economic surplus resulting from not being in competitive equilibrium
A) Producer atrophy B) Deadweight loss C) Economic shortage D) Marginal cost
A financial crisis is
A) not possible in the modern financial environment. B) a major disruption in the financial markets. C) a feature of developing economies only. D) typically followed by an economic boom.