Intermediate goods are goods and services used:
A. by the ultimate user.
B. by state and local governments.
C. as inputs.
D. both as inputs and final goods.
Answer: C
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How did the collapse of the housing bubble cause a contraction in output?
A. Because banks were unwilling to lend, many businesses were suddenly unable to access credit for their day-to-day needs. B. Because consumers lost confidence in the banking industry, they stopped depositing money, so banks could no longer lend. C. When banks wanted to make loans, but couldn't find any credit-worthy customers to loan to. D. When homeowners lost value in their homes, they stopped saving, which reduced banks' ability to lend.
In a monopoly market structure, the supplier in the market always
A. produces too much. B. earns economic profit. C. sells faulty products. D. is the whole industry.
Assume there is an increase in the number of consumers in the market for a good sold by perfectly competitive firms that are initially producing the profit-maximizing level of output. For the individual firm, this would result in:
A) a decrease in both price and the profit-maximizing quantity of output. B) a decrease in price and increase in the profit-maximizing quantity of output. C) an increase in both price and the profit-maximizing quantity of output. D) an increase in price and decrease in profit-maximizing quantity of output.
The manager of Greene Enterprises, Inc., recently estimated its average variable cost (AVC) function to beAVC = 88 - 0.026Q + 0.000003Q2Greene Enterprises faces total fixed costs (TFC) of $300,000. When Greene's output is 2,000 units, what is average variable cost (AVC)?
A. $20 B. $85 C. $72 D. $62 E. $48