A typical economic good has which one of the following characteristics?
A) The desired quantity exceeds the quantity available at a zero price.
B) The quantity available exceeds the desired quantity at a zero price.
C) It uses no resources to produce.
D) It is never scarce.
Answer: A
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If the local cable TV company is a natural monopoly and required by regulators to set its price equal to marginal cost, it makes zero profit and produces the efficient level of output
Indicate whether the statement is true or false
Compared with a U.S. Treasury note, a corporate bond is likely to have a
A) wider bid-asked spread. B) narrower bid-asked spread. C) higher bid price. D) higher asked price.
A firm sells 1000 units per week. It charges $15 per unit, the average variable costs are $10, and the average costs are $25 . In the long run, the firm should
a. Shut-down as the firm is making a loss of $10,000 per week b. Shut-down as price is lower than average cost c. Continue operating as the firm is covering all the variable costs and some of the fixed costs d. Shut-down because it is cost effective to pay off the remaining fixed costs
A mechanism for fixing exchange rates is the
A. Flexible exchange standard. B. Gold standard. C. WTO agreement. D. International Monetary Fund.