Sweet Treats sells its extra-large cupcakes for $12 each and the firm has a constant marginal cost of $8 per cupcake, which is equal to its (constant) average total cost. If Sweet Treats does not sell a cupcake the day it is produced, it is sold as day-old for $4. Sweet Treats should hold the number of cupcakes in inventory that makes the probability of selling that quantity of cupcakes or more
equal to ________.
A) 0.60 B) 0.40 C) 0.50 D) 1.00
C) 0.50
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Keynes's theory of the demand for money is consistent with ________ movements in ________
A) countercyclical; velocity B) procyclical; velocity C) countercyclical; expectations D) procyclical; expectations
When a transfer price is set higher
a. the profits of the division using the intermediate product will rise b. the profits of the division using the intermediate product will be unaffected c. the profits of the division using the intermediate product will fall d. the costs of the division using the intermediate product will fall
Comparing how many dollars it takes to attend college each year to annual earnings on a job represents the use of money as a:
a. medium of exchange. b. unit of account. c. store of value. d. store of coincidence.
The economy’s IS curve has a downward slope because
a) when output is too high, firms cut investment to reduce inventory b) as income rises, consumption rises and saving falls c) as interest rates rise, investment decreases d) as uncertainty increases, saving rises and consumption falls e) as government purchases rise, interest rates fall