If your firm's production function has constant returns to scale and you increase all your inputs by 60%, then your firm's output will
a. not change.
b. increase, but by less than 60%
c. increase by 60%
d. increase by more than 60%.
c
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Which of the following is not a developing country classified as a high-income economy because of possessing huge oil reserves?
a. United Arab Emirates b. Chad c. Qatar d. Kuwait e. Bahrain
Which of the following is an example of an automatic stabilizer?
a. Decrease in tax rates by Congress in times of unemployment b. Decrease in tax rates by Congress in times of inflation c. Increase in government defense spending during war d. Increase in unemployment compensation during recession e. Decrease in welfare programs during inflation
Unequal distribution of resources is one of the main reasons for international trade.
Answer the following statement true (T) or false (F)
Suppose you are deciding whether or not to increase production. You are currently making a profit. If you produce one more unit, your increase in cost will be $10, your average variable costs will increase to less than that, and your average fixed costs will decrease. Finally, your average revenue will increase to $12, but your increase in revenue will be $11. You should
A. increase production by at least 1 unit. B. leave production unchanged because profit is maximized where you are. C. increase production by exactly 1 unit. D. redo the math associated with decreasing production because that may result in greater profit.