In a constant cost industry:
a. a natural monopoly is likely to occur.
b. total cost is the same, no matter how much a firm produces.
c. the long-run supply curve will be perfectly elastic.
d. entry of new firms in the industry will lead to a reduction in the cost of inputs.
c
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According to the theory of cost, specialization in the use of variable resources in the short-run results initially in:
a. decreasing returns and declining average and marginal costs b. increasing returns and declining average and marginal costs c. increasing returns and increasing average and marginal costs d. decreasing returns and increasing average and marginal costs e. none of the above
If Producer A and Producer B are the only producers in the market, then the market quantity supplied when the price is $4 is
The argument that import restrictions save jobs and promote prosperity fails to recognize that:
A. there are no secondary effects of import restrictions. B. import restrictions will lower prices in the protected industries. C. import restrictions cannot create jobs in any industries. D. U.S. imports provide people in other countries with the dollars power required for the purchase of U.S. exports.
In Macroland there is $12,000,000 in currency. The public holds half of the currency and banks hold the rest as reserves. If banks' desired reserve/deposit ratio is 12.5%, deposits in Macroland equal ________ and the money supply equals ________.
A. $96,000,000; $96,000,000 B. $48,000,000; $54,000,000 C. $54,000,000; $54,000,000 D. $48,000,000; $75,000,000