Economies of scale occur when a firm's long-run average total cost curve is:
A. vertical.
B. horizontal.
C. downward-sloping.
D. upward-sloping.
Answer: C
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What type of protection does U.S. law grant the creator of a book, film, or piece of music?
A) A copyright, which grants exclusive rights to the creator for 20 years after the work is created. B) A patent, which grants the exclusive right to use the creation during the creator's lifetime and to his or her heirs for 70 years after the creator's death. C) A public franchise, which grants the exclusive right to use the creation during the creator's lifetime and to his or her heirs for 70 years after the creator's death. D) A copyright, which grants the exclusive right to use the creation during the creator's lifetime and to his or her heirs for 70 years after the creator's death.
When economists talk about a barrier to entry, they are referring to
a. a factor that makes it difficult for potential competitors to enter a market. b. the opportunity cost of equity capital that is incurred by a firm producing at minimum total cost. c. the downward-sloping portion of the long-run average total cost curve. d. the declining output experienced as additional units of a variable input are used with a given amount of a fixed input.
Growth in GDP per capita can only occur if the growth in:
A. Output is greater than the growth in population. B. Employment is greater than the growth in prices. C. Population is greater than the growth in unemployment. D. Prices is greater than the growth in output.
An example of a microeconomic decision is a situation in which
A. a government contemplates buying foreign currencies in an effort to influence exchange rates and the country's demand for goods and services. B. a firm evaluates how much to reduce the price of its product in an effort to influence sales and boost its profits. C. a central bank considers how much to increase the money supply during the coming month in an effort to constrain the rate of inflation. D. Congress and the president seek to reach a compromise on how much to increase government spending in an effort to influence national expenditures.