Mrs. Smith operates a business in a competitive market. The current market price is $8.10 . At her profit-maximizing level of production, the average variable cost is $8.00, and the average total cost is $8.25 . Mrs. Smith should
a. shut down her business in the short run but continue to operate in the long run.
b. continue to operate in the short run but shut down in the long run.
c. continue to operate in both the short run and long run.
d. shut down in both the short run and long run.
b
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Why are the losers from free international trade not fully compensated for their losses?
A) The amount of compensation needed would bankrupt the government. B) The losers are foreigners. C) The people who claim to lose are also the same ones who benefit. D) No one actually loses from international trade. E) Identifying all losers and the size of their losses is extremely difficult.
A falling dollar makes U.S. goods
A) more expensive abroad and increases the volume of U.S. exports. B) less expensive abroad and increases the volume of U.S. exports. C) less expensive abroad and decreases the volume of U.S. exports. D) more expensive abroad and decreases the volume of U.S. exports.
When determining interest rates, the loanable funds model is more useful when we are concerned with the determinants of the ________, and the money market model is more useful when we are concerned with the determinants of the ________
A) long-term real interest rate; short-term nominal interest rate B) short-term real interest rate; long-term nominal interest rate C) short-term real interest rate; short-term nominal interest rate D) long-term real interest rate; long-term nominal interest rate
When a country imposes a per-unit (ad-valorem) tariff on an imported good or service then, the price that domestic consumers pay for the import falls
Indicate whether the statement is true or false