One reason some manufacturing companies have moved production from overseas locations back to the United States is an increasing preference by U.S. consumers for products made in the United States. Assuming that managers at these companies used all
available information, including the increased preference by U.S. consumers for domestically produced, when making the decision to move production back to the United States exemplifies which key economic idea?
A) People are rational.
B) People respond to economic incentives.
C) Optimal decisions are made at the margin.
D) The market system relies on the principle of voluntary exchange.
Answer: A
You might also like to view...
Give an example from your text of a nontariff measure that could reduce the quantity of imports or exports
What will be an ideal response?
An increase in the MPC causes an increase in which of the following?
A) MPS B) spending multiplier C) savings rate D) exports E) aggregate supply
Suppliers will supply more of a good when the price of that good rises because the opportunity cost of not producing that good has risen.
Answer the following statement true (T) or false (F)
Suppose a perfectly competitive firm faces the following cost and revenue conditions: ATC = $25.50; AVC = $20.50; MC = $25.50; MR = $28.50. The firm should
A. shut down. B. continue to produce its current output. C. increase output. D. decrease output.