Suppose a firm doubles its output in the long run. At the same time the unit cost of production remains unchanged. We can conclude that the firm is
A) exploiting the economies of scale available to it.
B) facing constant returns to scale.
C) facing diseconomies of scale.
D) not using the available technology efficiently.
Answer: B
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Which one of the following twentieth-century nations eliminated the problem of scarcity?
A) Socialist Cuba B) Socialist China C) Fascist Italy D) The United States of America E) None of the above.
Martha and Wendy start a cookie shop and the business is organized as a corporation. Because of poor planning the business goes bankrupt and the corporation's debt is $30,000. Martha has $30,000 in savings and Wendy has $80,000 in savings
Martha must pay ________ of the debt and Wendy must pay ________ of the debt. A) $0; $0 B) $15,000; $15,000 C) $0; $30,000 D) None of the above answers is correct because each must pay but the amount each must pay cannot be determined without more information about who managed the company.
Which of the following explains most accurately why the firm's short-run marginal cost curve will eventually rise?
a. As more of the variable factor is used, its price will rise. b. When diminishing marginal returns set in, it will take ever-larger quantities of the variable resources to produce an additional unit of output. c. As the variable factor is used more intensely, its marginal product will rise, causing an increase in marginal costs. d. As the size of the firm increases, the operational efficiency of the firm declines, causing an increase in marginal costs.
Real output per capita is calculated by
a. multiplying the population by GDP b. dividing nominal GDP by the population c. dividing the population by nominal GDP d. dividing real GDP by the population e. dividing the population by real GDP