Producing an additional unit whose marginal cost exceeds the average total cost incurred thus far has the effect of pulling the
A. average cost up.
B. average cost down.
C. fixed cost up.
D. total cost down.
Answer: A
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A positive economic statement simply describes what is
a. True b. False Indicate whether the statement is true or false
Which of the following reasons helps explain why the aggregate demand curve is downward sloping?
a. The real balances effect or wealth effect: Consumers spend more on goods and services when the price level falls because lower prices increase consumer purchasing power. b. The producer-push effect: At less than full employment, increases in quantity demanded will raise price, and thus will motivate sellers to produce more. c. The hidden inflation effect: As the price level rises, consumers fail to recognize that prices are higher, and consequently they fail to reduce expenditures on goods and services. d. None of the above.
Resource X has many close substitutes, whereas resource Y has no close substitutes. Other things equal, we would expect:
A. the demand for resource Y to be more elastic than the demand for resource X. B. resources X and Y to be close substitutes. C. resource X to be more expensive than resource Y. D. the demand for resource X to be more elastic than the demand for resource Y.
Using Table 6.1, the inflation rate for 1999 would be
A. 2.7% (((168.3-163.9)/163.9)*100 %). B. 3.0% (174-163.9)/(2*163.9)*100%). C. 68.3% (168.3-100). D. 4.4% (168.3-163.9).