If one is on the contract curve
A. further beneficial trades can occur.
B. no further voluntary trade will occur.
C. the indifference curves of both consumers are crossing.
D. the allocation is not Pareto optimal.
Answer: B
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A firm should keep producing output as long as the marginal profit is greater than zero, no matter how small it is.
Answer the following statement true (T) or false (F)
On which point on the graph above should the economy operate if it wants to maximize its future production possibilities?
a. A b. B c. C d. D
Most economists view economic growth as:
A. good for the environment because richer economies spend more on environmental protection. B. bad for the environment because richer economies extract resources at a faster rate. C. good for the environment because richer economies produce fewer chemicals. D. bad for the environment because people in richer economies tend to care less about the environment.
In 2012, the United States imposed countervailing duties ranging from 24 to 36% (on imports of about solar panels from China. Which of the following do you predict will happen if the United States decides to eliminate these duties?
a. The U.S. price of solar panels will fall. b. U.S. production of solar panels will rise. c. U.S. imports of Chinese solar panels will fall. d. The U.S. price of solar panels will rise.