An In the News article discusses "Too Many Sellers: The Woes of T-Shirt Shops." If T-shirt shops are perfectly competitive firms, then
A. Shops can definitely earn an economic profit in the long run.
B. There are few T-shirt shops.
C. The barriers to entry are low.
D. Each shop has market power.
Answer: C
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Black markets can generally be eliminated when price ceilings are enacted.
Answer the following statement true (T) or false (F)
GDP is different than GNP in that
A) it accounts for net unilateral transfers. B) it does not account for indirect business taxes. C) it does not account for a country's production using services with foreign-owned capital. D) it accounts for depreciation. E) it is unhelpful when tracking national income.
Other things being constant, if the U.S. real rate of interest exceeds that of its trading partners, we expect
A) political instability in the United States. B) a worsening of the U.S. balance of payments. C) an appreciation of U.S. currency. D) that a "dirty float" will emerge.
The cost involved when choosing between alternatives is known as the
A. marginal cost. B. normative cost. C. sunk cost. D. opportunity cost.