A worldwide hops (a flowers used in brewing) shortage made stouts, ales and other specialty microbrews more pricy in 2008. Gayle Goshie, a hops farmer, blames overproduction for hops' previously cheap place on the agricultural market
The glut pushed many hop farmers out business, which gradually helped hop prices recover. Suppose farming hops is a perfectly competitive market. Why would some hop farmers go out of business? A) because the price of hops was below the minimum of average fixed cost
B) because the price of hops was lower than the minimum of average variable cost
C) because the price of hops was higher than the minimum of average variable cost
D) because the price of hops was lower than the minimum of average total cost
B
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The Ricardian two-country two-good model predicts that there are potential benefits from trade, but NOT
A) the effect of trade on income distribution. B) the mechanism that determines which country will specialize in which good. C) when one country has an absolute advantage in the production of both goods. D) when one country has significantly lower wages than the other country. E) when both countries have the same types of technology available.
In the Baumol model, the total quantity sold will usually be larger than
A) if perfect competition prevailed. B) if total costs were minimized. C) if profit were maximized. D) if companies were interdependent.
If incomes decrease in the United States, Americans will buy more goods, including foreign goods. This increase in demand for foreign goods will cause an increase in the demand for euros
a. True b. False Indicate whether the statement is true or false
_________________ laws give government the power to block certain mergers or to break up large firms into small ones.
a. Monopoly b. Antitrust c. Mergers and acquisitions d. Business size