The fundamental reason that marginal cost eventually rises as output increases is because of
a. economies of scale.
b. diseconomies of scale.
c. diminishing marginal product.
d. rising average fixed cost.
c
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Which of the following are substitute goods?
A) margarine and butter B) peanut butter and jelly C) pizza and beer D) sports utility vehicles and gasoline
Depreciation allowance ________ the taxes a firm must pay and ________ the net present value of an investment.
A) increases; increases B) increases; decreases C) decreases; decreases D) decreases; increases
If the cost of production incurred by two producers in a competitive industry differs, the long-run supply curve:
a. will be a downward sloping step function. b. will be an upward rising step function. c. will be a horizontal line at the market price. d. will be a vertical line at the equilibrium output.
When analyzing the housing market, the supply curve
a. will be upward sloping because the higher the price of a house the more that will exist b. will be horizontal to illustrate that the supply of housing is a stock variable c. will be downward sloping; that is what went wrong with the housing market d. will be vertical to illustrate that the supply of housing is a stock variable e. could be horizontal, vertical or upward sloping depending upon the housing market in question