According to the law of demand:
A. Price and quantity demanded are inversely related.
B. Price is constant along a particular demand curve.
C. The demand curve will shift rightward as price increases.
D. Businesses will produce more as price increases.
Ans: A. Price and quantity demanded are inversely related.
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Suppose at a certain quantity of output, a firm's average-total-cost curve lies above its demand curve. At this quantity of output, the firm:
a. is earning negative economic profit. b. is earning zero economic profit. c. is maximizing profit. d. should increase its output to maximize profit. e. should reduce output to maximize negative economic profit.
Which of the following is most likely to be a reason for immigrants to become entrepreneurs in developing countries?
a. They usually hold government positions. b. They are poorer than the domestic population. c. They are risk-averse. d. They have skills and experience that are lacking in poor nations. e. They quickly assimilate to their new environment.
Relative price is the price of a specific good compared to ______.
a. the price index b. the rate of inflation c. the price of that good one year earlier d. the price of other goods
What gives money value under a fiat system?
A. Fiat money is backed by gold. B. The supply of fiat money is controlled by the government. C. Fiat money is also a commodity. D. Fiat money is the same as Treasury bonds.