Which of the following is false about the long run?
a. The long-run equilibrium output for a firm in perfect competition occurs at the lowest point on the average total cost curve.
b. The shape of the long-run supply curve depends on the extent to which input costs change when there is entry or exit of firms in the industry.
c. In a constant-cost industry, the prices of inputs do not change as
output is expanded.
d. In an increasing-cost industry, the cost curves of the individual firms rise as the total output of the industry decreases.
d
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The commercial banks in Fundland have
Reserves $500 million Loans $3,500 million Deposits $4,000 million Total assets $5,000 million The banks hold no excess reserves. a) Calculate the banks' desired reserve ratio. b) An immigrant arrives in Fundland with $10 million, which she deposits in a bank. How much does the immigrant's bank lend initially?
If deviations from trend in a macroeconomic variable are negatively correlated with deviations from trend in real GDP, that variable is said to be
A) useless in predicting future movements in real GDP. B) procyclical. C) countercyclical. D) acyclical.
When the federal government installs a price support program that requires the government to purchase all of a good not bought in the private economy at the support price, changes in producer surplus
A) are negative. B) are positive, but more than offset by the cost to consumers and the government. C) are positive, and not offset by the cost to consumers and the government. D) and consumer surplus are both positive.
The concentration ratio of an industry is a measure that captures the share of the industry’s total output that is produced by its four largest firms.
Answer the following statement true (T) or false (F)