Society's total cost of producing a good
a. includes only the cost to the firm
b. includes only the external cost
c. includes all private and external costs
d. equals the value of the output level that maximizes the firm's profit
e. equals the value of the output level that minimizes the firm's loss
C
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By enjoying more consumer goods today, the economy spurs growth in future consumer goods.
Answer the following statement true (T) or false (F)
A firm uses workers and seed to grow lettuce. Its lettuce output rises from 100 tons to 200 tons when the number of workers increases from 25 to 75 . Its production process shows
a. decreasing returns to scale. b. diminishing returns to labor. c. increasing long-run average cost. d. decreasing short-run average variable cost.
Primary credit extended by the Fed is:
A. the highest interest rate loans offered by the Fed. B. loans offered at the prime interest rate for periods exceeding thirty days but less than one year. C. for banks needing long-term loans to work out financial problems. D. short-term, usually overnight loans.
Which statement is an example of substitute goods affecting demand?
a. A bumper crop of cotton lowers the price of cotton clothing. Sales of silk shirts decrease. b. As laptop computer sales increase, so do the sales of computer cases. c. An automobile maker lays off thousands. Sales of electronic goods in that city fall. d. Hi-tech companies lure people to a region. Demand for housing rises.