An In the News article titled "Eliminating the Competition with Low Prices" indicates that, in order to protect their prices and profits, the major carriers operating at the Washington, DC, Dulles airport
A. Acquired smaller carriers.
B. Practiced predatory pricing.
C. Permanently reduced their prices.
D. Used patents.
Answer: B
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If average variable cost is decreasing as output increases, then marginal cost is definitely
A) decreasing as output increases. B) increasing as output increases. C) less than average variable cost. D) greater than average variable cost.
An increase in resources, efficiency, or technology will shift the:
A) short-run aggregate supply curve rightward. B) short-run aggregate supply curve leftward. C) long-run aggregate supply curve rightward. D) long-run aggregate supply curve leftward.
Which of the following represents the key difference between the short run and the long run?
a. In the long run, the firm makes commitments to a certain type of production technology which are represented as fixed costs in the long run. For example, they have signed a lease on a particular production facility. These fixed costs do not exist in the short run. b. In the short run, the firm makes commitments to a certain type of production technology, which are represented as fixed costs in the short run. For example, they have signed a lease on a particular production facility. These fixed costs do not exist in the long run. c. The short run refers to less than two years and the long run in over two years. d. None of the above are correct.
Grocery stores often replace
A) low profit margin goods with services. B) low profit margin goods with high profit margin goods. C) high profit margin goods with low profit margin goods. D) goods with one type of elasticity with goods of similar elasticities.