The "lemons problem" exists because of
A) transactions costs.
B) economies of scale.
C) rational expectations.
D) asymmetric information.
D
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Suppose a sushi restaurant is making significant economic profit in the short run. In the long run
A) more people will open sushi restaurants, reducing the economic profit for each restaurant. B) high barriers to entry keep people from opening sushi restaurants. C) the government will require the sushi restaurant to sell part of its interests in the city. D) more people will open steak restaurants, increasing the economic profit for the sushi restaurant.
The law of diminishing returns
a. explains why marginal cost eventually increases as output expands. b. implies that average fixed cost will remain unchanged as output expands. c. is true for physical production activities but not for activities such as studying. d. applies to a capitalist economy but would be irrelevant if the means of production were owned by the state.
An American company operates a fast food restaurant in Paris, France. Which of the following statements is accurate?
a. The value of the goods and services produced by the restaurant is included in both French GDP and U.S. GDP. b. The value added by American workers and equipment in France is included in U.S. GDP and the value added by French workers and equipment is added to French GDP. c. The value of the goods and services produced by the restaurant is included in French GDP, but not in U.S. GDP. d. The value of the goods and services produced by the restaurant is included in U.S. GDP, but not in French GDP.
Refer to the information provided in Figure 6.14 below to answer the question(s) that follow.
Figure 6.14Refer to Figure 6.14. The ________ is the ratio of the marginal utility of ice cream cones to the marginal utility of ice cream sandwiches.
A. maximum number of ice cream cones that can be purchased B. maximum number of ice cream sandwiches that can be purchased C. slope of the indifference curve D. slope of the budget constraint