Refer to the Article Summary. Use a graph to illustrate average total cost curves for Macy's before and after closing the 35 to 40 stores. Assume that after closing the stores, Macy's will be producing at minimum average total cost
What will be an ideal response?
Before closing the stores, Macy's would be represented by ATC2, because they expected their sales to be Q2. In that case, their average costs would have been AC1. In fact, their sales were only Q1, which meant their costs were AC3. Based on changing shopping habits, Macy's is closing 35 to 40 stores. After closing these stores, Macy's is represented by ATC1. This would have lowered their average costs to AC2, which is at the minimum of this average total cost curve.
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The reserve demand schedule is drawn on a graph that has the quantity of reserves on the horizontal axis and
A. the price level is on the vertical axis. B. the federal funds rate is on the vertical axis. C. the price of bonds is on the vertical axis. D. income is on the vertical axis.
Unlike budgeters in 49 states, federal officials are not required to balance the budget
Indicate whether the statement is true or false
The standard discussion of monetary policy is based on the assumption that:
A. short-term rates will fall when the Fed pushes up long-term interest rates. B. short-term rates will rise when the Fed pushes up long-term interest rates. C. long-term rates will fall when the Fed pushes up short-term interest rates. D. long-term rates will rise when the Fed pushes up short-term interest rates.
Which of the following is a shortcoming of GDP?
A. GDP excludes changes in inventories. B. GDP includes an estimate of illegal transactions. C. GDP excludes nonmarket transactions. D. GDP excludes business investment spending.