What shape of LRAC curve indicates that any company that is producing about the same number of units shown in the middle of the curve will be able to compete on costs?
a. Flat-bottomed curve
b. U-shaped curve
c. Curve trending down from left to right
d. Curve trending up from left to right
a. Flat-bottomed curve
When the LRAC curve has a flat bottom, firms producing at any quantity along this flat bottom can compete.
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When the federal government changes purchases and/or taxes to stimulate the economy or rein in inflation, such policy is
A. automatic fiscal policy. B. active monetary policy. C. active federal policy. D. discretionary fiscal policy.
Dana spends $10,000 on remodeling a storefront that she then opens as a shoe store. The business has not been very successful, and she needs an additional $3,000 to keep the shoe store open. Which of the following is true?
A. The $10,000 Dana spent on remodeling is a fixed cost of her business. B. The $10,000 Dana spent on remodeling represents a part of the total variable cost of her business. C. The $3,000 Dana needs to keep the deli open represents her total fixed costs. D. The $3,000 represents her marginal costs of production.
If the price level was 100 in 2017 and 102 in 2018, the inflation rate was
A. 102%. B. 0.2%. C. 2%. D. 20%.
Critics of social regulation would argue that it:
A. Decreases prices B. Increases output C. Increases competition D. Decreases product innovation