If a competitive firm is losing money then it should:
A. always shut down.
B. shut down if its losses are greater than total fixed costs.
C. shut down if its total fixed costs are greater than losses.
D. raise its price.
Answer: B
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"U.S. exports will increase as a result of joined CAFTA," is an example of a ________ statement, while "The U.S. should join CAFTA," is an example of a ________ statement.
A. structural policy; fiscal policy B. positive; normative C. normative; positive D. monetary policy; fiscal policy
A central bank can help stop a bank panic by
A) calling in consumer loans. B) raising the required reserve ratio. C) acting as a lender of last resort. D) decreasing income taxes.
Protectionism is
a. the belief that a nation's industries should be protected from foreign competition b. the belief that a nation's consumers should be protected from foreign competition c. based on the idea that economies of scale are important d. consistent with absolute advantage, but not with comparative advantage e. the favored approach of pro-trade groups
Which of the following is a problem with the price system that can lead to fluctuations in output?
A. The price system works silently in the background. B. Prices can be slow to adjust. C. Prices may be flexible. D. All of these