Specialization and exchange result in
a. lower production levels than would otherwise be possible
b. higher living standards than would otherwise be possible
c. more down-time as workers switch activities more frequently
d. the assignment of workers to activities according to their preferences
e. self-sufficiency
B
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Suppose Chip's Chips produces bags of potato chips. An example of a variable cost for this firm would be:
A. the factory building. B. the deep fryer. C. the potato peeling machine. D. None of these is an example of a variable cost.
Assume that the price-consumption curve is horizontal. What additional information does that tell you about the demand for good X and the amount people spend on it?
What will be an ideal response?
Suppose there are three power-generating plants, each of which has access to 5 different production processes. The table below summarizes the cost of each production process and the corresponding number of tons of smoke emitted each.ProcessABCDE(smoke/day)(4 tons/day)(3 tons/day)(2 tons/day)(1 tons/day)(0 tons/day)Cost to Firm X ($/day)$500$514$530$555$585Cost to Firm Y ($/day)$400$420$445$480$520Cost to Firm Z ($/day)$300$325$360$400$550 The least costly way of lowering smoke emissions from 12 tons to 9 tons per day would be for:
A. Firm X to emit 2 tons, Firm Y to emit 3 tons and Firm Z to emit 4 tons. B. Firm X to emit 1 ton, Firm Y to emit 4 tons and Firm Z to emit 4 tons. C. each firm to reduce emissions by 1 ton, emitting 3 tons each. D. Firm X to emit 4 tons, Firm Y to emit 3 tons and Firm Z to emit 2 tons.
If a shift in aggregate demand only affects real Gross Domestic Product (GDP), then the short-run aggregate supply (SRAS) curve must be
A) upward sloping. B) downward sloping. C) horizontal. D) vertical.