The concept of economies of scale becomes especially relevant to international trade when it enables
a. numerous small producers to supply the entire country.
b. one or two large producers to supply the entire country.
c. numerous large producers to supply the entire country.
d. one or two small producers to supply the entire country.
b. one or two large producers to supply the entire country.
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When the marginal rate of return expected from a purchase of equipment is less than the market interest rate, then the firm should
a. seek government assistance in decreasing the market interest rate b. inform stockholders that the company can expect increased earnings from the purchase c. either purchase or not purchase the equipment depending on the marginal resource cost of the equipment d. purchase the equipment e. not purchase the equipment
A rise in net exports shifts the aggregate
a. demand curve inward. b. demand curve outward. c. supply curve outward. d. supply curve inward.
People who took out mortgages at the height of U.S. inflation in 1981:
A. paid much higher real interest rates than expected since inflation fell dramatically after 1981. B. paid much lower real interest rates than expected since inflation fell dramatically after 1981. C. paid much higher real interest rates than expected since inflation rose dramatically after 1981. D. paid much lower real interest rates than expected since inflation rose dramatically after 1981.
Using the Taylor rule, if the current inflation rate equals the target inflation rate and real GDP is less than potential GDP, then the federal funds target rate ________ the sum of the current inflation rate plus the real equilibrium federal funds rate
A) will be greater than B) will be less than C) will be the same as D) may be greater than or less than