When plasma television sets were first introduced prices were high and few firms were in the market. Later, economic profits attracted new firms and the price of plasma televisions fell. This example illustrates
A) a decreasing-cost industry.
B) that consumers receive this new technology "free of charge" in the sense that they only have to pay a price for plasma televisions equal to the lowest production cost.
C) an industry with a low minimum efficient scale.
D) how fickle consumer demands are.
Answer: B
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If GDP per capita in year T is represented by YT, and the GDP per capita in the following year is represented by YT+1, then the formula for calculating growth rate between these two years is ________
A) (YT+1 - YT)/YT B) (YT+1 + YT)/YT+1 C) (YT+1 + YT)/YT D) (YT+1/YT)/100
An economy is producing two goods, ice cream and cookies, and is currently operating efficiently. This economy can produce more cookies if: a. it increases the price of ice cream
b. it increases the price of cookies. c. more of the economy's resources become idle. d. it produces less ice cream.
A bank initially has $620 million in assets and $580 million in liabilities. The banks net worth (capital) is _____________ million. If the bank's assets decline by 5% and its liabilities do not change, its capital decreases by ____________
A) $40; 5% B) $70; 141.4% C) $40; 77.5% D) $600; 5%
What is a possible explanation as to why workers who have been on the job for a long time earn more than newly hired workers?
A. Workers in long-lasting job matches accumulate specific training over time, which increases the workers' productivity. B. Workers in bad job matches tend to stay on the job longer. C. Young workers are more productive than older workers. D. U.S. law requires older workers to be paid more than younger workers. E. The positive effects of general training on education erode over time.