Creative destruction by innovation means
A. destruction of an innovative product once it fails in the market.
B. introduction of an innovative product makes older substitute goods obsolete.
C. substitute goods make innovative goods less competitive in the market.
D. introduction of innovative goods increase the competition in the market
Answer: B
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Which one of the following statements about water pricing in the United States is true?
a. As most water utilities are monopolies, they tend to make excessive profits b. Water prices are normally set according to the average cost of providing water c. Water prices are normally set according to the marginal water cost of providing water d. Water prices are normally set according to the interaction of supply and demand e. Water prices fluctuate significantly based on changes in seasonal demands
The average total cost of producing electronic calculators in a factory is $20 at the current output level of 100 units per week. If fixed cost is $1,000 per week:
A. total cost is $3,000. B. average variable cost is $10. C. average fixed cost is $20. D. variable cost is $2,000.
The reason that the multiplier is smaller if there are variable taxes is that
A. taxes add to government spending, which increases income. B. people get angry about taxes and decide to work less. C. tax increases shift the expenditure line upward. D. part of an increase in income is taken away in taxes.
Since 1950, farm productivity has:
A. advanced twice as fast as in nonfarm sectors of the economy. B. lagged behind productivity advances in the nonfarm economy. C. almost exactly matched productivity increases in the rest of the economy. D. doubled.