An estimated short-run cost function
A. holds the capital stock constant.
B. can be estimated using time-series data.
C. can be used to make price and output decisions.
D. both a and c
E. all of the above
Answer: E
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Assume that there are two nations, Alpha and Beta. Each nation produces two products, wheat and steel. Alpha has a comparative advantage in the production of wheat. If the two nations trade, the trade price of wheat in terms of steel will be
A. greater than the domestic opportunity cost of wheat in both nations. B. less than the domestic opportunity cost of wheat in both nations. C. less than the domestic opportunity cost of wheat in Alpha and greater than the domestic opportunity cost of wheat in Beta. D. greater than the domestic opportunity cost of wheat in Alpha and less than the domestic opportunity cost of wheat in Beta.
The Federal Reserve is
A) a Kentucky bourbon. B) a wild game preserve. C) an express mail service. D) the central bank of the United States.
Explain why the LDCs are unable to invest much in capital goods and human capital.
What will be an ideal response?
If the quantity demanded for a product exceeds the quantity supplied, the market price will rise until
A) the quantity demanded equals the quantity supplied. The product will then no longer be scarce. B) quantity demanded equals quantity supplied. The equilibrium price will then be greater than the market price. C) only wealthy consumers will be able to afford the product. D) quantity demanded equals quantity supplied. The market price will then equal the equilibrium price.