The assignment of inputs to specific industries by central planners is made difficult by
A. the interdependency among industries.
B. lack of data for decision making.
C. the danger of a chain reaction among industries if an error is made at any point.
D. All of the responses are correct.
Answer: D
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The U.S. is able to maintain a large trade deficit because:
A. when the business cycle is in a boom, it will be a trade surplus. B. it is balanced by a large capital surplus. C. it is balanced by a large capital deficit. D. None of these statements is true.
GDP measures
A. the market value of final products produced in the nation during the year.
B. the sum of the market value of final products produced and imported during the year.
C. the market value of intermediate products produced during the year.
D. the sum of the market value of both final and intermediate products produced during the year.
Natural monopoly exists when:
A. one firm can supply the entire quantity demanded at higher cost than two or more firms. B. the long-run average cost curve exhibits constant returns to scale. C. one firm can supply the entire quantity demanded at lower cost than two or more firms. D. one firm can supply the entire quantity demanded at the same cost as two or more firms.
A price discriminating pure monopolist will attempt to charge each buyer (or group of buyers):
A. different prices to compensate for differences in the characteristics of the product. B. the same price if per unit cost is constant for each unit of the product. C. that price that equals the buyer's marginal cost. D. the maximum price each would be willing to pay.