What is the most likely effect of the development of DVDs, rental movies, and online movie streaming on the movie theater industry?
A. increased demand for movie theater tickets
B. increased price elasticity of demand for movie theater tickets
C. decreased costs of producing movies
D. movie theater tickets become an inferior good
Answer: B
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Explain what is meant by the phrase a bank's "balancing act."
What will be an ideal response?
If the market price ever drops below a firm's average variable costs at its profit-maximizing level of output the:
A. firm should shut down immediately. B. loss-minimizing quantity of output is zero. C. firm is not earning enough revenue to cover the variable costs of production. D. All of these are true.
An appreciation of the currency is likely to occur if:
(a) Domestic interest rates fall. (b) There is an increase in demand for imports. (c) There is an increase in demand for exports. (d) There is an increase in the balance of payments deficit.
If there are diseconomies of scale within a given range of output, which of following is (are) TRUE?
A) The short-run average cost curve must be upward sloping within that range of output. B) The long-run average cost curve must be upward sloping within that range of output. C) Long-run average cost must equal short-run average cost. D) All of the above.