Suppose the cost of producing cellular phones declines from $25 to $20 . If buyers' valuations remain fixed at $30, the transaction would create _____ more economic value
a. $10
b. $5
c. $2
d. $15
B
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Differentiate between the process of defending an undervalued currency and an overvalued currency?
What will be an ideal response?
When the market is in long-run equilibrium in a perfectly competitive market, this implies that in the long run means
A. no firm in the industry has an incentive to exit. B. no firm outside the industry has an incentive to enter. C. no firm in the industry has an incentive to increase or decrease its output. D. all of these conditions are met in the long run equilibrium.
One of the important points of criticism of industrial policy is that: a. it can lead to stiff competition among the domestic firms in an economy. b. small domestic firms will not be able to survive economic clustering
c. government sponsored research will end up benefitting foreign countries. d. it can prohibit regional innovations. e. the knowhow in one firm will not spill over to other firms in an economy.
A firm that exists as a separate legal being is
a. a sole proprietorship b. a corporation c. a partnership d. likely to be a small, family-run business e. still dependent on its owners in many ways