The output gap is
A) the difference between target output and realized output.
B) the difference between initial output and final output.
C) the difference between market-clearing output and actual output.
D) the difference between forecasted output and past output.
C
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The table above gives costs at Jan's Bike Shop. Unfortunately, Jan's record keeping has been spotty. Each worker is paid $100 a day. Labor costs are the only variable costs of production. What is the total cost of producing 50 bikes?
A) $100 B) $200 C) $300 D) $400
Which of the arguments Staples and Office Depot made in defense of their proposed merger would be least defensible on economic grounds?
A) There would be substantial economies of scale. B) The two firms were in competition with all other office supply stores, not just office supply superstores. C) The history of low pricing by the two stores meant that they would not raise prices in the future after they merged. D) Entry into the office supply market is relatively easy.