Refer to Figure 16.1. A decrease in the depreciation rate is best represented by a movement from
A) point A to point B.
B) point B to point A.
C) point A to point C.
D) point C to point A.
D
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Which of the following gives rise to a pecuniary externality?
A) Excessive consumption of alcohol leading to ill health B) Sudden increase in the demand for diamonds leading to an increase in their price C) Deforestation leading to the extinction of many species D) Globalization leading to the displacement of indigenous workers
If at the current level of product-specific service, consumers' value at $60 and the cost of retailers to provide the services is $60, which of the following is true?
A) the profit-maximizing level of profit-maximizing services is less than the current level B) the profit-maximizing level of profit-maximizing services is greater than the current level C) the profit-maximizing level of profit-maximizing services is exactly double the current level D) the profit-maximizing amount of product-specific services is being offered.
When increased demand raises the price of the product, the
A) marginal revenue product will also increase. B) marginal revenue product will fall. C) marginal revenue product will remain unchanged. D) sales will fall.
Deviations from purchasing power parity will be increasingly higher as international trade tariffs become more restrictive. The main reason for this phenomenon is that:
a. arbitrage activities become less profitable. b. governments prefer purchasing power parity not to hold. c. the interest rate parity fails to hold. d. goods become more differentiated across countries. e. individuals develop hatred toward closed economies.