How is the long-run average cost curve found? What is its importance to the firm?
What will be an ideal response?
The long-run average cost curve is the locus of points representing the minimum unit cost of producing any given rate of output, given the current technology and resource prices. It is the envelope of the various short-run average cost curves. It is significant in that it is the planning curve for the firm in deciding whether to expand its production facilities or not.
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According to Julian? Simon,
What will be an ideal response?
A negative externality exists when
A. a person's or group's actions cause a benefit that is felt by others. B. a person's or group's actions cause a cost that is felt by others. C. market output is less than socially optimal output. D. a and c E. b and c
Which of the following is NOT one of the ways a budget surplus can be used?
A) to allow private saving to fall without any need for a decline in total investment B) to stimulate domestic investment C) to reduce foreign investment D) to increase the amount of borrowing from foreigners
When demand is inelastic,
A) price and revenue move in opposite directions. B) price and revenue are not related. C) price and quantity demanded move in opposite directions. D) price and revenue move in the same direction.