All of the following are non-price factors that influence demand except: A) tastes and preferences. B) quantity supplied. C) income. D) the prices of related goods. ANSWER B
According to the case for analysis (Demand and Supply in the Copper Industry) in the text, all of the following can lead to a decline in the price of copper except: A) steady production uninterrupted by labor strikes or natural disasters. B) substitution away from copper to other materials such as aluminum and plastic. C) […]
________ investment is more volatile than other forms of investment spending because this type of investment can be changed relatively quickly. A) Business fixed B) Inventory C) Residential D) Capital ANSWER B
Mutual interdependence among firms is one of the key characteristics of an oligopoly market that distinguishes it from the other three major market structures. Indicate whether the statement is true or false ANSWER TRUE
Why are isoquants negatively sloped? A) Along a single isoquant, the firm can substitute the use of one input for another while holding the total level of output constant. B) Due to the effects of diseconomies of scale. C) Because the farther the isoquant is from the origin, the higher the level of output. D) […]
Taxes levied on a firm’s earnings ________ the effective cost of funds. A) lower B) raise C) have no effect D) none of the above ANSWER B
Which of the following is not cited as one of the factors that accounts for the large-scale production that exists in many sectors of the economy? A) Economies of scale. B) Advertising and image differentiation. C) The minimum efficient scale of operation in many industries is quite high relative to market demand. D) Risk spreading. […]
List and describe the sources of spending in the economy by focusing on the four major sectors of the economy. What will be an ideal response? ANSWER The four major sources of spending in the economy include consumption spending, which is spending by households on durable and non-durable goods and services; gross private domestic […]
Assume a consumer is currently purchasing a combination of goods, X and Y, that maximizes her utility given her budget constraint, i.e., MRSX,Y = PX/PY. Now assume that there is a decrease in the price of Y. In this case, to once again maximize her utility, the consumer will want to adjust her purchases of […]
The capacity utilization rate is the ratio of ________ to ________. A) production; capacity B) capacity; production C) capacity; potential GDP D) none of the above ANSWER A