Which of the following mechanisms would not be used by a country to defend a fixed exchange rate?
A. The government can alter domestic interest rates to influence short-term international capital flows.
B. The government can impose a form of exchange control.
C. The government can threaten to shift to a floating exchange rate.
D. The government can buy or sell foreign currency to influence the actual exchange rate.
Answer: C
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Which of the following statements is true?
A) Trade leads to inefficient allocation of resources. B) Trade discourages workers to specialize in production. C) International trade creates supply bottlenecks. D) Trade allows people to choose occupations that suit their talents.
If the single-input producer choice set is fully convex, the first order conditions of the profit maximization problem are necessary but not sufficient for identifying the profit maximizing production plan.
Answer the following statement true (T) or false (F)
The psychological rewards of inventing a new product generally result in ____ profits for entrepreneurs.
A. below average B. only average C. above average D. indeterminate
Straker Industries estimated its short-run costs using a U-shaped average variable cost function of the formAVC = a + bQ + cQ2and obtained the following results. Total fixed cost (TFC) at Straker Industries is $1,000.
At Straker Industries, average variable cost (AVC) reaches its minimum value at ________.
A. $72.80 B. $24.50 C. $121.80 D. $33.60