When a firm is on the flat portion of its long-run ATC curve,
A. it is experiencing constant returns to scale.
B. changing its firm size will not affect its total cost per unit.
C. it is capturing the lowest average total costs possible in the industry.
D. All of these are possibly true.
D. All of these are possibly true.
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If the minimum efficient scale of a firm is small relative to the demand for the good, then
A) many small firms can compete in the market. B) several large firms will enter the market thereby reducing competition. C) there will be no economic profits for any small firms, so no new firms will ever enter the market. D) the firms already in the market have lower average total cost than any new firm entering the market.
Excess reserves are
A) desired reserves minus actual reserves. B) required reserves minus actual reserves. C) liquidity funds minus actual reserves. D) actual reserves minus desired reserves.
Make use of a graph of the foreign exchange market to show how the Brazilian Central Bank can use an unsterilized intervention to reduce the value of its currency, the real, in terms of the dollar
What will be an ideal response?
If a positive permanent supply shock were to occur, the resulting equilibrium would be a:
A. higher level of output at lower prices. B. lower level of output and prices. C. higher level of output and prices. D. lower level of output at higher prices.