Average total costs are minimized when:
A. marginal costs begin to increase.
B. marginal costs begin to decrease.
C. marginal cost is greater than average total cost.
D. marginal cost equals average total cost.
Answer: D
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The price-misperceptions model differs from the equilibrium business cycle model in that households
a. no longer serve as providers of capital services. b. find that market-clearing prices move to equilibrium slowly. c. sometimes misinterpret changes in nominal prices as changes in real prices. d. typically face disequilibrium because prices fail to clear markets.
Incentives are
A. potential rewards available if a particular activity is undertaken. B. ineffective as a device to get people to behave in a certain fashion. C. useless when people behave rationally. D. inappropriate ways to obtain a certain kind of behavior.
Refer to the information provided in Table 33.5 below to answer the question(s) that follow. Cashews are measured in bushels and tea is measured in pounds (lbs.)
Table 33.5
Refer to Table 33.5. In Vietnam, the opportunity cost of
A. a lb. of tea is 2/15 of a bushel of cashews. B. a lb. of tea is 40 bushels of cashews. C. a bushel of cashews is 4/3 of a lb. of tea. D. a lb. of tea is 1/8 of a bushel of cashews.
The limited ability to raise funds is a disadvantage for
A) sole proprietorships and partnerships. B) partnerships and corporations. C) sole proprietorships and corporations D) corporations.