As output is expanded, if marginal cost (MC) is less than average total cost (ATC),
a. ATC must be at its minimum.
b. ATC must be at its maximum.
c. ATC must be decreasing.
d. the firm must be earning economic profit.
C
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Making a choice at the margin means
A) letting someone else choose for you. B) waiting until the last minute to make a choice. C) deciding to do a little bit more or a little bit less of an activity. D) making a choice by comparing the total benefit and the total cost.
The Fed conducts an open-market sale of Treasury bills of $5 million. If the required reserve ratio is 0.20, what change in the money supply can be expected using the oversimplified money multiplier?
A. $25 million B. $5 million C. 0 D. ?$5 million E. ?$25 million
When FDI occurs, what are the longrun effects of FDI on industry output in the recipient nation?
a. There is no change in either the output of the capitalintensive or the laborintensive industry. b. The laborintensive industry expands; the capital intensive industry contracts. c. The capitalintensive industry expands; the labor intensive industry contracts. d. Both capital and laborintensive industries expand in the same proportion.
The fact that a bank's assets tend to be long-term while its liabilities are short-term creates:
A. lower risk for the bank, this is why they follow this strategy. B. credit risk. C. trading risk. D. interest-rate risk.