If an input must be increased for output to increase, it is called a
A. unchangeable input.
B. variable input.
C. changeable input.
D. fixed input.
Answer: B
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In the above figure, if this natural monopolist were unregulated, the profit maximizing firm would sell the product at the price
A) A. B) B. C) C. D) F.
What are the short-run economic effects when U.S. firms substitute labor outside of the U.S. for labor inside the U.S.?
A) The demand curve for labor in the U.S. decreases, and the demand curve in the foreign country will increase. B) The demand curve for labor in the U.S. increases, and the demand curve in the foreign country will decrease. C) The demand curve for labor in the U.S. decreases, and the demand curve in the foreign country will decrease. D) The demand curve for labor in the U.S. increases, and the demand curve in the foreign country will increase.
The nation of Isolani forbids international trade. In Isolani, you can exchange 1 car for 5 motorcycles. In other countries, you can exchange 1 car for 4 motorcycles. These facts indicate that
a. other countries have an absolute advantage, relative to Isolani, in producing cars. b. Isolani has a comparative advantage, relative to other countries, in producing cars. c. if Isolani were to allow trade, it would import motorcycles. d. the world price of motorcycles exceeds the price of motorcycles in Isolani.
Because pollution taxes raise the costs of production for firms, firms:
A. will lower prices to consumers. B. must receive a higher price at every level of output. C. will increase the quantity produced at every price. D. will quit producing goods that generate pollution.