The total cost curve for a firm can be derived from isoquants and isocost lines by
A. varying production technologies, but keeping input prices and expenditure levels constant.
B. varying total expenditures while keeping input prices and production technology constant.
C. varying the price of either capital or labor while keeping total expenditures and production technology constant.
D. varying the prices of capital and labor and keeping total expenditure constant.
Answer: B
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The real exchange rate is:
A) how much of a foreign currency you can buy with the domestic currency. B) foreign CPI divided by the domestic CPI. C) the price of foreign goods in terms of domestic goods. D) the price of foreign goods in dollars. E) the domestic currency divided by the price level.
Suppose a blackjack gambler approaches an insurance company and seeks to purchase an insurance policy that his next trip to Reno, NV will not net $10,000. The insurance company
A) will sell her an insurance policy because the proposal entails uncertainty not risk. B) will sell her an insurance policy because the proposal entails risk not uncertainty. C) will not sell her an insurance policy because the proposal entails uncertainty not risk. D) will not sell her an insurance policy because the proposal entails risk not uncertainty.
Larry has a comparative advantage over his classmates in writing term papers if he:
A. has a lower opportunity cost of writing term papers than his classmates. B. has an absolute advantage in writing term papers. C. can write term papers faster than his classmates. D. always earns an A on his term papers.
A decrease in aggregate supply means:
A. both the real domestic output and rises in the price level would become greater. B. the real domestic output would increase and rises in the price level would become smaller. C. the real domestic output would decrease and the price level would rise. D. both the real domestic output and the price level would decrease.