A large aircraft manufacturer, like Boeing, may have a cost advantage over a new smaller manufacturer because of:
A. diseconomies of scale.
B. economies of scale.
C. diminishing returns to a fixed factor of production.
D. the principal agent problem is generally less severe for larger firms.
Answer: B
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All games share three characteristics. Two of these characteristics are rule and strategies. What is the third characteristic called?
A) payoffs B) competition C) collusion D) results
If a bank has excess reserves of $4,000 and demand deposit liabilities of $100,000, and if the reserve requirement is 15 percent, then the bank has actual reserves of
A) $17,000. B) $19,000. C) $24,000. D) $29,000.
High-income people will sometimes pay higher prices at convenience stores for goods that are available at discount stores. They do this because
a. they are irrational b. their opportunity cost of time is low c. crowded and understaffed discount stores impose higher time costs d. they like to be seen paying more money e. they do not mind wasting time
The balance of payments ____________
a. is positive when the nation has a trade surplus b. is an itemized account of a nation's foreign economic transactions c. for some nations is positive and for others is negative but for the sum of all nations is zero d. is negative when the nation has a trade deficit e. can only be expanded when the government has foreign exchange reserves