Because of higher gasoline prices, firms using gasoline intensively in the production or distribution of their goods have experienced:
A. an upward shift in their MC, AVC, and ATC curves.
B. an upward shift in their AFC, AVC, and ATC curves.
C. a downward shift in their MC, AFC, and AVC curves.
D. greater economies of scale.
Answer: A
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Suppose two goods (X and Y ) are being produced efficiently and that the production of X is always more labor intensive than the production of Y. Production depends only on two factors (capital and labor); these may be smoothly substituted for each other. The total quantities of these inputs are fixed. An increase in the production of X and a decrease in the production of Y will
a. increase the capital-labor ratio in each firm. b. decrease the capital-labor ratio in each firm. c. leave the capital-labor ratio for each firm unchanged. d. increase the capital-labor ratio in Y production and decrease the capital-labor ratio in X production.
Which of these is an example of a contractionary fiscal policy?
a. A decrease in the sales tax rate b. An increase in unemployment insurance c. An increase in the excise tax rate d. A decrease in import duty
The superstar phenomenon explains why professional athletes earn more than amateur athletes
a. True b. False Indicate whether the statement is true or false
Real income will fall whenever:
A. wages increase faster than prices. B. wages increase and prices stay the same. C. prices and wages increase at the same rate. D. prices increase faster than wages.