Which of the following is not an example of an automatic stabilizer?
What will be an ideal response?
the reduction in income tax revenues during a recession
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Answer the following statements true (T) or false (F)
1) In general, if two stages in a supply chain are making an economic profit by setting prices that exceed their marginal cost of production, managers can increase profit through vertical integration. 2) Because vertical integration is a yes or no decision, managers cannot use marginal analysis. 3) If a firm has a monopoly in both the production and distribution, managers of the two divisions should be encouraged to maximize profits in their separate divisions. 4) If a firm has a monopoly in both the production and distribution, to maximize the overall economic profit of the firm, managers of either the production or distribution center should be instructed to maximize profit and the managers of the other center should be instructed to operate as a competitive market. 5) Vertical integration can eliminate double marginalization.
A soft budget constraint applies when enterprises that earn profits distribute those profits to their private owners
a. True b. False
An association of workers that presents itself as a single seller of labor on the labor market is called a
a. monopsony b. monopoly c. labor union d. minimum wage e. labor supply curve
A fundamental principle of international trade is that
A. a country could never have lower resource costs than other countries in the production of ALL goods and services. B. a country could never have lower opportunity costs than other countries in the production of ALL goods and services. C. two nations could both have a comparative advantage over each other in production of the same good. D. the world gains from trade because trade allows production of goods and services to move to nations with the lowest resource cost.