The long-run supply curve would be upsloping in:
A. a decreasing-cost industry.
B. a constant-cost industry.
C. a variable-cost industry.
D. an increasing-cost industry.
Answer: D
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If the required reserve ratio is 0.2, and the Fed buys $3,000 of U.S. government securities, the maximum amount by which the money supply can increase is: a. $200
b. $2,000. c. $600. d. $15,000. e. $1,500.
The exchange-rate effect is the idea that a higher U.S. price level causes the value of the dollar to increase in foreign exchange markets, and this effect contributes to the downward slope of the aggregate-demand curve
a. True b. False Indicate whether the statement is true or false
Using Figure 4.2, suppose point C represents the optimal mix of public and private goods for a society. The market mechanism is likely to result in a mix of output represented by point
A. C because the market mechanism is efficient. B. B because the market mechanism tends to overproduce public goods. C. F because the market mechanism is inefficient. D. D because the market mechanism tends to underproduce public goods.
Which of the following is true when a Nash equilibrium is reached in a duopoly with homogeneous products?
A) Both the firms earn positive economic profits. B) Each firm charges a price equal to its average fixed cost. C) Both the firms earn zero economic profits. D) Both firms incur huge losses.