Many large universities rent out parts of their campuses to conference groups during the summer because such groups cause little damage, require little staff attention, and bring in large amounts of income. A university's decision to rent its campus to a conference group is most clearly based on
a. the idea that price and quantity selection is a single decision.
b. the principle of decreasing returns to scale.
c. marginal analysis.
d. average cost considerations.
c
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The aggregate demand curve shows the
A) total amount of nominal goods that the participants in the economy want to purchase. B) amount of goods producers will produce as production costs fall. C) total amount of real goods that foreigners want to purchase. D) total amount of planned expenditures on goods and services at each possible price level.
In managing its liabilities to deal with liquidity problems, banks trade off
A) credit risk against interest rate risk. B) adverse selection against moral hazard. C) the need for available funds to meet deposit outflows against the desire for greater profit. D) present tax liabilities against future tax liabilities.
In the aggregate demand-aggregate supply model, economic growth can be illustrated by an
a. outward shift of the aggregate demand curve. b. inward shift of the aggregate demand curve. c. inward shift of the aggregate supply curve. d. All of the above.
If everyone earned the same income, the Lorenz curve would be
A) a rectangular hyperbola. B) a straight line from the origin at a 45-degree angle. C) the horizontal axis. D) very bowed from the diagonal.