Larger firms can produce a product at lower average cost than small firms when:
A. economies of scope exist.
B. cost complementarities exist.
C. diseconomies of scale exist.
D. economies of scale exist.
Answer: D
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The above figure shows the market for steel ingots. If the market is competitive, then to achieve the socially optimal level of pollution, the government can
A) outlaw the production of steel. B) institute a specific tax of $25. C) institute a specific tax of $50. D) institute a specific tax equal to area b.
Refer to the payoff matrix below. If each cell has a probability of occurrence of 0.25, what are Healthy Snacks' expected profits?
Healthy Snacks and Best Treats are two firms competing in the health food snacks market. Both are considering introducing a new health food snack made purely of dried power fruits. The payoff matrix shows their net economic profit in millions for the different strategies.
A) $6.5 B) $11 C) $3.5 D) $9.25
An increase in the value of the dollar in international exchange rate markets will cause the relative price of U.S. produced goods to foreigners to rise, the relative price of foreign produced goods to Americans to fall, causing U.S. exports to fall and U.S. imports to rise
a. True b. False Indicate whether the statement is true or false
Crowding out will lead to a decrease in supply of loanable funds, a decrease in real interest rates, and subsequently a decrease in spending by households and firms
a. True b. False Indicate whether the statement is true or false