Finding the occupation or business activity in which you are relatively more productive helps you earn more money than otherwise would be the case. This reflects the
A) principle of compound interest.
B) law of diversification.
C) law of large numbers.
D) law of comparative advantage.
D) law of comparative advantage.
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For a given amount of nominal income, the real income will
A. rise as the price level rises. B. fall if the price level falls. C. fall if the price level rises. D. be unaffected if the price level falls.
In the short run, a profit-maximizing firm's decision to produce should be guided by whether
A) its total revenue exceeds its fixed cost. B) its total revenue covers its variable cost. C) it makes a profit. D) its marginal profit is maximized.
The long run is a period of:
a. at least one year. b. sufficient length to allow a firm to expand output by hiring additional workers. c. sufficient length to allow a firm to alter its plant size and capacity and all other factors of production. d. sufficient length to allow a firm to transform economic losses into economic profits by hiring better workers.
Cyclical unemployment results from: a. a mismatch of skills
b. being in the wrong geographical location. c. monetary cost and the time it takes to find the best job. d. seasonal decreases in demand for labor. e. prolonged declines in business activity.