Average fixed costs of production
A) will rise at a fixed rate as more is produced. B) remain constant.
C) graph as a U-shaped curve. D) fall as long as output is increased.
D
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When the interest rate in the economy was 10%, the price of a bond with no expiration date that pays a fixed annual interest of $500 was $5,000. If the interest rate in the economy falls to 6%, the price of this bond will be about
A. $7,128. B. $4,700. C. $8,333. D. $5,030.
Which of the following is a statement with positive economic analysis?
A) Lower wages increase employment and reduce the unemployment rate. B) Slower money growth reduces inflation. C) A reduction in the size of the budget deficit will reduce interest rates. D) all of the above
Exhibit 3A-1 Comparison of Market Efficiency and Deadweight Loss
As shown in Exhibit 3A-1, if the market price falls from $2.00 to $1.00, then:
A. total surplus increases. B. deadweight loss increases. C. overproduction decreases. D. underproduction decreases.
Refer to the above figure. If the relevant aggregate demand curve is AD2, what is the current economic situation?
A. inflationary gap B. recessionary gap C. overemployment D. equilibrium