A recession is a period of time in which real GDP falls.
Answer the following statement true (T) or false (F)
True
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The efficient transfer price is
a. the upstream division's average cost b. the upstream division's marginal cost c. the downstream division's average cost d. the downstream division's marginal cost
The marginal tax rate refers to the tax rate charged on the:
A. last dollar a taxpayer earns. B. income earned from buying investments and selling them at a higher price. C. earnings of individuals. D. value of a good or service being purchased.
Suppose you find that the price of your product is less than minimum AVC. You should:
A. minimize your losses by producing where P = MC. B. maximize your profits by producing where P = MC. C. close down because, by producing, your losses will exceed your total fixed costs. D. close down because total revenue exceeds total variable cost.
Suppose in the city of Blacksburg, music stores operate in a monopolistically competitive market. If the price of CDs in Blacksburg is currently equal to $20 per CD and the average cost of CDs is $15, in the long run we expect the price of CDs to:
A. increase. B. stay the same. C. decrease, and the average cost of selling CDs to increase. D. decrease, and the average cost of selling CDs to decrease.