A firm that is earning a positive profit in the short run and expects to continue doing so has an incentive to expand its scale of operation in the long run.
Answer the following statement true (T) or false (F)
True
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The major economic cost of growth is:
A. consumption sacrificed for capital formation. B. higher interest rates. C. higher inflation rates. D. investment in stocks and bonds.
An increase in the price of steel will result in
A. a decrease in the prices of automobiles. B. an increase in the cost of labor to produce automobiles. C. an increase in the equilibrium quantity of automobiles. D. a decrease in the supply of automobiles.
According to the Application, the cultural changes in England allowed individuals to take advantage of
A) the elimination of trade barriers resulting from the formation of the European Union. B) the decrease in population caused by the number of citizens who were leaving for the New World. C) new developments in science and technology. D) the increase in agrarian lifestyles.
Suppose you cash in a Certificate of Deposit (a small time deposit) to acquire the traveler's checks you'll need for your vacation. What happens to M1 and M2?
A) M1 and M2 both increase. B) M1 stays the same and M2 increases. C) M1 increases and M2 decreases. D) M1 increases and M2 stays the same.