Most product markets are perfectly competitive.
Answer the following statement true (T) or false (F)
False
Few, if any, product markets are perfectly competitive. However, many industries function much like the competitive model; therefore, understanding how the market works is important.
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Refer to Figure 19-5. The Chinese government pegs the yuan to the dollar, at one of the specified exchange rates on the graph, such that it overvalues its currency. Using the figure above, this would generate
A) a shortage of yuan equal to 500 million. B) a shortage of yuan equal to 100 million. C) a surplus of yuan equal to 700 million. D) a surplus of yuan equal to 200 million.
If C(X) represents the total cost of activity X, then which of the following expressions best represents the marginal cost of activity X?
A. C(X) - C(X - ?X) B. (C(X) - C(X - ?X))/?X C. (C(X) - C(X - ?X))/X D. C(X - ?X))/?X
Opportunity cost is the difference between the nominal and real cost of some action.
Answer the following statement true (T) or false (F)
Why do national income accountants include indirect business taxes in the income approach to GDP computation?
A. Indirect business taxes are the allowances for the portion of capital worn out by producing GDP. B. Indirect business taxes are part of firms' profits. C. Indirect taxes are income payments to suppliers of resources. D. Indirect business taxes are income for the government received through collection by firms.