A firm is operating in its range of economies of scale and is on both its LRAC curve and its short-run ATC curve. At that level of output, the slope of its LRAC curve is
A) zero and the slope of its ATC curve is zero.
B) zero and the slope of its ATC curve is negative.
C) negative and the slope of its ATC curve is zero.
D) negative and the slope of its ATC curve is negative.
D
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A natural monopoly is most likely to occur in which of the following industries?
A) the pharmaceutical industry because the development and approval of new drugs through the Food and Drug Administration can take more than 10 years B) the software industry because of the importance of network externalities C) an industry where fixed costs are very large relative to variable costs D) the diamond mining and marketing industry because one firm can control a key resource
The size of the reduction in quantity of labor hired by a firm due to an increase in the wage rate depends upon all of the following except
a. what percentage of total costs are made up of labor costs. b. how much quantity demanded in the output market will be reduced by a higher price. c. the capital to labor ratio before the wage increase. d. how easily other inputs can be substituted for labor.
Which of the following will be recorded as a debit entry in the balance of trade in merchandise account?
a. A U.S. car manufacturer selling a car to a resident of India. b. A pub owner in Liverpool importing vodka from a U.S. manufacturer. c. A U.S. textile manufacturer buying rawmaterial from farmers in Indonesia. d. A Chinese car manufacturer importing car engines and other spare parts from a U.S. manufacturer. e. A fashion designer from Michigan exporting readymade garments to a dealer in Copenhagen.
Refer to the accompanying table. ________ has the comparative advantage in making pies and ________ the comparative advantage in making cakes. Time to Make a PieTime to Make a CakeMartha60 minutes80 minutesJulia50 minutes60 minutes
A. Martha; Martha B. Julia; Julia C. Julia; Martha D. Martha; Julia