Which of the following about costs is true?
a. The difference between the ATC and AVC curves will decline as output expands.
b. The AFC will remain constant as output increases.
c. If ATC is increasing, then AVC must be greater than ATC.
d. Implicit costs and fixed costs are always the same.
A
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Suppose the CPI has been overstating the increase in the cost of living by 1% for 25 years, the total impact of that 25 years later is
a. less than 25% b. exactly 25% c. negligible since it is only 1% per year d. more than 25% e. 24%
When comparing monetary and fiscal policy under fixed and floating exchange rate regimes, which of the following statements is FALSE?
A) In a floating exchange rate regime, an expansionary monetary policy is effective by stimulating spending and by depreciating the currency. B) In a floating exchange rate regime, an expansionary fiscal policy is effective by stimulating spending, though there may be crowding-out effects due to higher rates of interest and currency appreciation. C) In a fixed exchange rate regime, an expansionary monetary policy is effective by stimulating spending; it has no impact on the currency value or the trade balance. D) In a fixed exchange rate regime, an expansionary fiscal policy is effective by stimulating spending, as long as the parallel expansionary monetary policy keeps exchange rates stable.
The free-rider problem arises because:
A.) Private goods are not available. B.) Most public goods involve illegal activity. C.) People prefer private goods. D.) Public goods can be jointly consumed.
The cost of producing one more unit of a good:
a. increasing marginal returns b. total cost c. marginal revenue d. marginal product of labor e. marginal cost