When there is a shift the aggregate supply curve caused by factors external to a nation's economy, it is called
A) government control. B) an economic anomaly.
C) a supply shock. D) a trade imbalance.
C
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Apple Computer is more likely to continue to use input markets rather than manufacture its own inputs internally when
a. the quality of inputs is difficult to determine b. switching among input suppliers is easy c. there are very few firms producing the input d. the input is difficult to identify and define e. transaction costs go up
Constant returns to scale occur when a firm's
a. marginal costs are constant as output increases. b. long-run average total costs are decreasing as output increases. c. long-run average total costs are increasing as output increases. d. long-run average total costs do not vary as output increases.
Suppose that Bieber and Rihanna are duopolists in the music industry. In May, they agree to work together as a monopolist, charging the monopoly price for their music and producing the monopoly quantity of songs. By June, each singer is considering breaking the agreement. What would you expect to happen next?
a. Bieber and Rihanna will determine that it is in each singer's self interest to maintain the agreement. b. Bieber and Rihanna will each break the agreement. Both singers' profits will decrease. c. Bieber and Rihanna will each break the agreement. Both singers' profits will increase. d. Bieber and Rihanna will each break the agreement. The new equilibrium quantity of songs will increase, and the new equilibrium price also will increase.
The effects of a per-unit tax imposed on sales of an industry's product would likely include
A) a lower product price at any amount of the product supplied. B) a leftward shift of the market supply curve for the product. C) a leftward movement along the market supply curve for the product. D) none of the above.