The long-run supply curve would be downsloping in:
A. a variable-cost industry.
B. an increasing-cost industry.
C. a constant-cost industry.
D. a decreasing-cost industry.
Answer: D
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The marginal propensity to consume is:
a. the change in disposable income divided by the change in consumption. b. consumption spending divided by disposable income. c. disposable income divided by consumption spending. d. the change in consumption divided by the change in disposable income. e. the change in consumption divided by disposable income.
In the balance of payments, "net errors and omissions":
a. Must be zero. b. Is like a balancing item. It makes the balance of payments equal zero. c. Is not a part of the balance of payments because governments don't make errors, and they don't omit transactions from the balance of payments. d. None of the above.
Suppose that electricity producers create a negative externality equal to $5 per unit. Further suppose that the government gives a $5 per-unit subsidy to producers. What is the relationship between the equilibrium quantity and the socially optimal quantity of electricity to be produced?
a. They are equal. b. The equilibrium quantity is greater than the socially optimal quantity. c. The equilibrium quantity is less than the socially optimal quantity. d. There is not enough information to answer the question.
Import tariffs are ___________ on imports, and import quotas are ____________ on imports.
a. subsidies; taxes b. limits; subsidies c. taxes; limits d. limits; taxes