A decreasing-cost industry is one in which:
A. contraction of the industry will decrease unit costs.
B. input prices fall or technology improves as the industry expands.
C. the long-run supply curve is perfectly elastic.
D. the long-run supply curve is upsloping.
Answer: B
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If Cassie's Coffee House purchases 33 cents worth of ingredients and spends 36 cents on wages per cup of coffee to produce an 89 cent cup of coffee, then Cassie's Coffee House's contribution to GDP is ________ per cup of coffee
A) 20 cents B) 33 cents C) 36 cents D) 56 cents
A shift in demand toward the foreign country's goods would ________ the domestic real interest rate and ________ net desired saving (desired saving less desired investment) in the economy
A) lower; increase B) lower; decrease C) raise; increase D) raise; decrease
When the price of one good changes, while the prices of all others stay the same:
A. the change in relative prices is reflected in a change in the slope of the budget constraint. B. the change in relative prices can be thought of as a change in the opportunity costs of each good. C. the change in relative prices is reflected in a change in the marginal utility per dollar spent on each good. D. All of these statements are true.
If the average total cost curve is always above the demand curve of a monopolist,
a. the profits of the monopolist will be large. b. the monopolist must be producing inefficiently. c. even a monopolist will suffer economic losses. d. entry will occur, forcing the monopolist to reduce price and expand output.