According to a study by Blinder et al., on average, fixed costs account for about 44 percent of firms' total costs of production, suggesting that fixed costs are more important to many firms' decision-making processes than standard theory would
suggest. Indicate whether the statement is true or false
TRUE
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Refer to Figure 18-1. The French fall in love with California wines and triple their purchases of this beverage. Assuming all else remains constant, this would be represented as a movement from
A) B to C. B) C to D. C) A to B. D) A to D. E) B to A.
A decreased government deficit created by a lump-sum tax increase will increase national saving if
A) the value of government bonds outstanding grows slower than the public's wealth. B) it causes consumption to fall. C) the government runs a primary surplus as a result. D) the real interest rate is less than the growth rate of real GNP.
Variance is a measure of ________ and the lower the variance, ________
A) expected profit; the lower the profit B) risk; the lower the risk C) standard deviation; lower the standard deviation D) risk; the greater the risk
Refer to Scenario 17.5. If a fixed wage of $3000 is given the individual worker, the result will be
A) low effort 75% of the time. B) low effort 25% of the time. C) low effort. D) high effort. E) high or low effort depending on whether the worker thinks the $3000 is an acceptable wage.