If more foreign plastic plants relocate to the United States, we would expect
A. the U.S. supply curve for plastic to shift to the right.
B. the U.S. supply curve for plastic would shift to the left.
C. that U.S. plastic demand might change, but U.S. plastic supply would remain the same.
D. that the U.S. plastic market would not respond.
Answer: A
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While specialization and exchange were very important to Adam Smith in 1776, they have largely lost their importance in the 21st century.
Answer the following statement true (T) or false (F)
What happens in a monopolistically competitive market with the entry of new firms?
What will be an ideal response?
Which of the following statements regarding the trucking industry is correct?
A) The recession of 2007 -2009 caused many trucking firms to exit with many firms filing for bankruptcy. B) The trucking industry most closely resembles an oligopoly. C) Even though there is a high degree of competition, firms in the trucking industry are able to sustain positive economic profits as a result of a substantial degree of product differentiation. D) The trucking industry was largely unaffected by the recession of 2007-2009 mainly because the industry is comprised by large firms with significant market power.
The Happy Mountain Brewing Company sells ground organic coffee in one pound containers through several grocery chains in the US
The firm has two divisions: the roasting division buys raw organic coffee beans and then blends, roasts, and grinds the beans, and the merchandising division packages and distributes the ground coffee. a. Please draw a carefully labeled figure that illustrates the optimal transfer pricing policy for the firm if there is no outside market and the firm is a monopoly seller (i.e., there are no other sellers of ground organic coffee). In particular, please show the optimal transfer price that is paid to the roasting division, the optimal retail price charged by the merchandising division, and the optimal amount of coffee sold. b. Suppose poor weather conditions in South American increase the price of raw coffee beans. How does this affect the marginal cost curve for the roasting division? Does this also affect the marginal cost of merchandising (packaging and distribution)? How do the optimal transfer price, retail coffee price, and quantity sold change due to this weather problem?