An improvement in a firm's technology that reduces its production costs will result in a(n):
a. rightward shift of the supply curve.
b. increase in supply.
c. increase in quantity supplied at any given price.
d. all of these are true.
d
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In the Keynesian framework, as long as output is ________ the equilibrium level, unplanned inventory investment will remain positive and firms will continue to ________ production
A) below; lower B) above; lower C) below; raise D) above; raise
Answer the following statement(s) true (T) or false (F)
1. A sandwich is an example of a club good. 2. Asymmetric information means both parties in a transaction share the same knowledge. 3. Used car sellers are at an advantage over buyers. 4. In adverse selection, one party takes advantage of knowing more than the other. 5. When one party in a sale is dishonest with the other, it is called moral hazard.
Which of the following statements is true?
A. Specialization and trade along the lines of comparative advantage allows nations to consume more than if they were to produce just for themselves. B. Free trade theory suggests that when trade takes place any gains made by one nation comes at the expense of another. C. According to the theory of comparative advantage, a nation should specialize in the production of those goods for which it has an absolute advantage. D. One country can have the comparative advantage in both goods, but it can only have the absolute advantage in one good as long as the opportunity costs are different.
Explain what is necessary if a business is to earn economic profits.
What will be an ideal response?