Long-term contracts become longer:
A. when spot markets work well.
B. when the exchange environment is more complex.
C. when marginal costs are declining.
D. when specialized investment becomes more important.
Answer: D
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Scarcity is a situation in which ________
A) some people are poor and others are rich B) something is being wasted C) we are unable to satisfy all our wants D) long lines form at gas stations
Wally's Widgets currently hires 8 workers. The average product of labor is 15 widgets per day, and the marginal product of a 9th worker is expected to be 13 widgets per day
If the firm hires the 9th worker, what will happen to the average product of labor? Explain.
The difference between gross public debt and net public debt is that
A) net public debt includes interagency borrowing while the gross domestic product debt does not. B) net public debt is expressed in real terms while gross public debt is expressed in nominal terms. C) gross public debt includes interagency borrowing while net public debt does not. D) gross public debt is held by individuals while net public debt is held by the government.
The fundamental reason why most supply curves are upward sloping is that
A) consumers substitute lower-priced goods for higher-priced goods. B) the quantity supplied increases as more firms enter the market. C) a higher price never reduces quantity supplied by enough to lower total revenue and so higher production is motivated. D) higher production raises the opportunity costs of production and so price must rise to induce more output.