The United States imports shoes from third world countries. This means that if the U.S. economy were closed, the domestic price of goods would be ________ the world price of shoes.
A. greater than
B. close to
C. less than
D. equal to
Answer: A
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Refer to Figure 18.1. The opportunity cost of bicycles in the United States is
A) 1/3 of a hang glider. B) 1/2 of a hang glider. C) 3 hang gliders. D) 4 hang gliders.
If an industry is characterized by economies of scale:
A) barriers to entry are usually not very large. B) long-run average costs of production increase as the quantity the firm produces increases. C) capital requirements are small due to the efficiency of the large-scale operations. D) the costs of entry into the market are likely to be substantial.
If Happy Campers and Camping R Us are camper suppliers in tacit collusion and Happy Campers launches a new advertising campaign that states that it will meet any competitor's price on a comparable camper, Happy Campers might be tacitly signaling to Campers R Us that they are willing to ________.
A) maintain current the price B) cut price is exactly half C) raise their price D) lower their price
A profit-maximizing perfectly competitive firm will
A. produce an output at which marginal cost equals marginal revenue. B. produce an output at which marginal cost equals price. C. have a marginal cost curve that intersects the minimum point of its average total cost curve. D. A perfectly competitive firm will do all of these things.