The shut-down decision is a short-run decision.
Answer the following statement true (T) or false (F)
True
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Studies have shown links between calcium consumption and a reduction in osteoporosis. How does this affect the market for calcium?
A) The calcium demand curve shifts to the right because of a change in tastes in favor of calcium. B) The calcium supply curve shifts to the right because of a change in tastes in favor of calcium. C) The calcium supply curve shifts to the left because this new information will increase the price of calcium. D) The calcium demand curve shifts to the left because this new information will increase the price of calcium.
Which of the following monetary policies will increase money supply?
a. An increase in the discount rate b. An increase in the reserve requirement c. Open market purchases by the Fed d. The Fed selling government bonds e. An increase in the federal funds rate
A corporation has been steadily losing money on one of its product lines, plastic flamingo lawn ornaments. The firm produces plastic flamingos in a factory that cost $20 million to build 10 years ago. The firm is now considering an offer to buy that factory for $15 million. Which of the following statements about the decision to sell or not to sell is correct?
a. The firm should turn down the purchase offer because the factory cost more than $15 million to build. b. The $20 million spent on the factory is a sunk cost; that cost should not affect the decision. c. The $20 million spent on the factory is an implicit cost, which should be included in the decision. d. The firm should sell the factory only if it can reduce its costs elsewhere by $5 million.
The appreciation of a currency will:
A. balance a trade surplus. B. worsen a country's comparative advantages. C. improve a country's comparative advantages. D. have no impact on a country's comparative advantages.