In terms of the production possibilities diagram, the principle of increasing cost simply asserts that the frontier is
A. downward sloping.
B. upward sloping.
C. bowed inward.
D. bowed outward.
E. undefined, because no market will exist in this case.
Answer: D
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How does a firm in a competitive market decide what level of output to produce in order to maximize its profit?
What will be an ideal response?
Going from M0 to M1 and to M2, what is the principle?
A) from household money demand to firm money demand B) from illiquid to liquid C) from most usable to least usable for transaction purposes D) from most usable to least usable as a store of value
When people buy assets simply because they believe the assets will appreciate and can be sold for a profit, it may cause:
A. a recession. B. unemployment. C. inflation. D. an asset-price bubble.
In a perfectly competitive industry, which of the following is a market signal to resource owners?
A) economic profits B) quality of goods C) the level of exports in the country D) the level of subsidies the industry receives