Drive with Us is an automobile retailer and pays floor plan financing to finance the cars they hold in inventory. If the interest rate on their floor plan financing decreases from 5 to 3 percent, Drive with Us's expected marginal cost from holding additional cars in inventory will shift ________ and the profit-maximizing number of cars to hold in inventory will ________.
A) upward; increase
B) upward; decrease
C) downward; decrease
D) downward; increase
D) downward; increase
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When benefit-cost analysis is used to facilitate U.S. public policy decisions,
a. the discount rate is selectedby the individual policy maker b. no adjustment can be made for inflation, since the inflation rate is not known in advance c. the discount rate used should reflect the social opportunity cost of funds d. only incremental costs are adjusted for time differences
In the above figure, curve b shows the
A) bottles of soda that people are willing to forgo to get another bicycle. B) bottles of soda that people must forgo to get another bicycle. C) benefits of producing more bicycles is greater than the benefits of producing more soda. D) benefits of producing more soda is greater than the benefits of producing more bicycles.
The fact that the production function relating output to capital becomes flatter as we move from left to right means that
A) the marginal product of labor is positive. B) the marginal product of capital is positive. C) there is diminishing marginal productivity of labor. D) there is diminishing marginal productivity of capital.
A worker can begin receiving benefits as early as age 58.
A. True B. False C. Uncertain