Explain why firms' short-run marginal cost curves often initially decreases and then increases
What will be an ideal response?
Diminishing marginal returns and specialization causes the MC curve to be U-shaped.
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An inward shift of the demand curve for a product causes outward shifts in the demand curves for all the factors used to produce the product.
Answer the following statement true (T) or false (F)
The natural rate of unemployment: a. is the sum of both frictional and structural unemployment when they are at a maximum. b. includes only frictional unemployment
c. includes only structural unemployment. d. includes only cyclical unemployment.
When national income increases from $300 billion to $400 billion, national consumption increases from $300 billion to $360 billion. At Y = $400 billion, the MPC is
a. 0.2 b. 0.5 c. 0.6 d. 0.67 e. 1.33
The HeckscherOhlin model assumes that factors of production can move freely _______, but cannot move _______.
a. domestically; internationally b. after they are fully trained; before the training period is over c. internationally; domestically d. within unskilled occupations; into highskill jobs