If a firm's fixed cost (overhead) increases, what happens to its profit-maximizing price and output?
Nothing. Whatever output was most profitable before the increase in fixed costs must still be most profitable because total profit is reduced by the same amount at each and every output level and marginal cost has not changed.
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The velocity of circulation, V, is equal to
A. PQ. B. MQ. C. PQ/M. D. M/PQ.
Argentina's government established a currency board to
A. coordinate internal growth policies. B. signal its commitment to stop the country's hyperinflation. C. boost its export demand. D. minimize the impact of large international capital flows.
A country that is experiencing a balance of payments surplus and decides to keep its exchange rate at the current level will:
A. experience a trade deficit. B. gain foreign currency. C. buy more of its own currency. D. lose foreign currency.
Suppose an economy experiences an increase in technological progress. This increase in technological progress will
A) allow more output to be produced with the same number of workers. B) allow the same amount of output to be produced with fewer workers. C) lead to changes in the types of goods produced. D) all of the above E) none of the above