A key reason that the value of the dollar did not change relative to the Chinese yuan in the early 2000s was:
A. the U.S. Federal Reserve bought dollars to keep the value of the dollar from falling.
B. the Chinese central bank sold dollars to keep the value of the dollar from rising.
C. trade was balanced between the two nations.
D. the Chinese central bank bought dollars to keep the value of the dollar from falling.
Answer: D
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Suppose a firm sells its product in a competitive market. If the ongoing wage rate in a competitive labor market is $30 and the market price of a firm's product is $2, then which of the following statements is true?
A) The firm should continue to hire workers until the marginal product of the last worker hired is 2 units. B) The firm should continue to hire workers until the marginal product of the last worker hired is 5 units. C) The firm should continue to hire workers until the marginal product of the last worker hired is 10 units. D) The firm should continue to hire workers until the marginal product of the last worker hired is 15 units.
Long-run average cost is never greater than short-run average cost because in the long run,
A) capital costs equal zero. B) the firm can move to the lowest possible isocost curve. C) wages always increase over time. D) wages always decrease over time.
A corrective tax is intended to: a. cover the costs of negative externalities
b. increase the private benefits of consumption. c. increase the deadweight loss caused by negative externalities. d. increase the deadweight loss caused by positive externalities.
The idea that the desires of resource suppliers and firms to further their own self-interest will automatically further the public interest is known as:
A. Consumer sovereignty B. The invisible hand C. Derived demand D. Creative destruction