The short-run market supply in a perfectly competitive market is the horizontal summation of the firms' marginal cost curves when
A. increases in industry output do not affect input prices.
B. increases in industry output lead to increases in market price.
C. increases in industry output do not affect market price.
D. increases in industry output lead to increases in input prices.
Answer: A
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In an economy with no government and no international trade, consumption expenditures will be less than the total value of goods and services when
A) people save some of their income. B) people barter rather than use money in making exchanges. C) saving is zero. D) investment is zero.
A disadvantage of the proprietorship form of business organization is
A) its limited access to capital. B) its limited liability. C) that it can issue only one class of stock. D) that the owner must fight a lot of red tape to form the firm.
The sticky-wage theory of the short-run aggregate supply curve says that when the price level rises more than expected,
a. production is more profitable and employment rises. b. production is more profitable and employment falls. c. production is less profitable and employment rises. d. production is less profitable and employment falls.
The present position of a nation on its production possibilities curve will influence the future position of the production possibilities curve.
a. true b. false