The long-run industry supply curve ________ in a decreasing-cost industry.
A. is horizontal
B. is vertical
C. slopes down
D. slopes up
Answer: C
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An economy with an expansionary gap will, in the absence of stabilization policy, eventually experience a(n) ________ in the inflation rate, leading to a(n) ________ in output.
A. decrease; increase B. increase; increase C. decrease; decrease D. increase; decrease
If economies of scale exist for a particular production relationship, long-run average costs will
A. rise. B. fall. C. first rise and then fall. D. be unaffected since there is no direct relationship between the two.
In the Great Depression of the 1930s, the unemployment rate in the U.S. climbed to what percentage?
A) 5 B) 10 C) 15 D) 20 E) 25
The circular flow model assumes:
a. businesses and households own the factors of production. b. businesses own the factors of production. c. government owns the factors of production. d. households own the factors of production. e. firms, households, and the government own the factors of production.