A firm experiences diminishing marginal returns because:
A. all factors of production are variable.
B. people "learn by doing."
C. all factors of production are fixed.
D. at least one factor of production is fixed.
Answer: D
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The informal sector is characterized by
a. firms that don't pay their taxes b. firms from other countries that are not subject to local laws c. firms producing illegal goods d. firms that are small and often able to avoid many government regulations e. all of the above
A fall in the price of farm land and farm prices in the early 1980s caused
a. farmers to borrow more heavily on that land to plant crops b. banks that had lent heavily to farmers to go bankrupt when the farmers were unable to repay their loans c. banks that had lent heavily to farmers to earn extraordinary profit when farmers repaid loans faster than usual d. banks to increase their loans to farmers until the price of farm land increased e. banks and farmers to get together to renegotiate their loans until the price of land and goods increased
Which industry would be the best example of an oligopoly?
A. Retail clothing B. Fast food C. Electricity D. Steel
Aggregate demand determines output in the short run if prices are flexible.
Answer the following statement true (T) or false (F)