One reason that firms will experience decreasing returns to scale is:
A. the law of diminishing marginal returns.
B. the specialization of inputs as scale increases.
C. there is some fixed input that isn't being taken into consideration.
D. larger firms may be easier to manage effectively.
C. there is some fixed input that isn't being taken into consideration.
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If interest rates fall in country A, other things constant,
a. demand for that country's currency will fall and the currency will depreciate b. demand for that country's currency will fall and the currency will appreciate c. demand for that country's currency will rise and the currency will depreciate d. demand for that country's currency will rise and the currency will appreciate e. people in country B will pull money out of country A
Big Health Insurance Company believes it is facing an adverse selection problem. What does this mean?
a. Buyers have more information than the company about their own risk status. b. The company has only poor-risk customers selecting their policies. c. The company’s health policies are unappealing to customers, causing them to go elsewhere. d. Buyers have been changing their minds and switching from one kind of policy to another.
Which of the following is an example of a pure market economy?
a. ?United States b. ?Switzerland c. ?Singapore d. ?No nation has a pure market economy
Which statement is false?
A. Our balance of payments is the entire flow of U.S. dollars and foreign currencies into and out of the country. B. Our trade balance is just the difference between our imports and our exports. C. Our trade balance has been negative since the mid-1970s. D. None of these statements are false