What types of risk can firms mitigate using futures contracts?
A. Price Risk
B. Price spread risk
C. Production risk
D. A and B
Ans: D. A and B
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When a firm experiences economies of scale, long-run average total cost falls as the quantity of output increases
a. True b. False Indicate whether the statement is true or false
Economies of scale exist where the long-run average cost curve is
A. upward sloping. B. horizontal. C. downward sloping. D. tangent to the marginal cost curve.
If the marginal cost of producing a good is increasing as a firm produces more of the good, then which of the following must be TRUE?
A) AFC is rising. B) AVC is rising. C) MC > AVC. D) MPL is falling.
Refer to the above figure. Suppose the economy's initial equilibrium is represented by the intersection of LRAS2 and AD2
Now there is an increase in labor productivity which increases total planned production at any given price level and aggregate demand remains stable. The resulting change in the economy's long-run equilibrium position would be represented by a A) movement from B to D. B) movement from C to D. C) movement from C to B. D) movement from A to B.