In some industries where firms experience declining average total costs over the full range of output that consumers are willing to buy,
a. a smaller firm will always have lower per-unit costs.
b. many firms will tend to emerge from the competitive process.
c. a single large firm will develop, and it will have cost advantages that protect it from potential rivals.
d. a single large firm will develop, and it will buy out any smaller rival firms to avoid the small firms' production at a lower per-unit cost.
C
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Which of the following statements is true of the world price of a good?
A) It is determined by the World Bank. B) It is determined by the intersection of the world supply and world demand curves for the good. C) It is always less than the domestic price of the good in the country that exports the good. D) It is always greater than the domestic price of the good in the country that imports the good.
For a short-run production function in which output is determined by the number of workers utilized (capital stock held constant), which of the following is FALSE?
A. To determine the marginal product of labor, the capital stock must be held constant. B. When the marginal product of labor is negative, total product is falling. C. When diminishing returns set in, adding one more worker decreases output. D. In general, when there are few workers the marginal product of labor will be increasing. E. none of the above
All of the following are examples of positive statements EXCEPT:
A. Higher interest rates reduce construction activity. B. Higher interest rates are achieved by slowing the growth of the money supply. C. Historically higher rates of money growth are associated with higher rates of inflation. D. Economic output should not be allowed to increase too fast.
When sellers price discriminate,
A. They are trying to find a minimum price the individual is willing to pay. B. They are attempting to charge a price that is the maximum price each individual is willing to pay. C. They are trying to pit one group of buyers against another. D. They are taking an illegal action.