A firm's cost can decrease for each of the following reasons, EXCEPT:
a. an increase in productivity due to experience.
b. an improvement in productivity of capital employed.
c. an improvement in work environment and quality of management.
d. an increase in input prices.
D
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Assume that Jane has limited wealth to invest in two assets both of which promise her returns worth $3,000 after two years. The first is a bank deposit assuring an interest of 10 percent per annum and the second is a private bond with an interest rate of 8 percent per annum. Which of the two would require a low initial investment and of what amount?
a. The bond requiring an initial investment worth $2,564 . b. The bank deposit requiring an initial investment worth $2,479. c. The bond requiring an initial investment worth $2,479. d. The bank deposit requiring an initial investment worth $2,564.
Another election cycle is coming up. Tangie is a very busy person, and like most voters, she displays rational ignorance. What does this mean Tangie is most likely to do?
a. Learn very little about the candidates and possibly not even vote. b. Learn as much as she can about the issues but be unable to make a choice. c. Learn as much as she can about the issues and cast her informed vote. d. Learn very little about the issues, but spend hours campaigning for a candidate.
What are externalities, and how do they affect who pays the true cost of a polluting factory?
What will be an ideal response?
Assume you have $2,000 in a savings account at the beginning of the year and the price level is equal to 100. If the price level is equal to 95 at the end of the year, the real value of your savings is closest to
A. $1,900. B. $1,905. C. $2,105. D. $2,095.