A feature of imperfect competition is _________, which means that as the firm expands its production, average costs of production fall. Therefore, the firm can _______ its costs of production by selling internationally.
a. economies of scale; decrease
b. economies of scale; increase
c. increasing returns to scale; decrease
d. specialization; increase
Ans: a. economies of scale; decrease
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When nations enter into currency unions, their fiscal affairs continue to be separate. The exception to this situation is whenever a confederation of states has a system:
A) whereby monetary policy is decided by consensus rather than centrally. B) of government subsidies for firms exporting outside the union. C) of fiscal mechanisms that permits interstate transfers. D) of common tax policies and regulatory rule.
If the demand for eBook readers increases and the supply of eBook readers increases, then
A) it is clear that prices will increase, the change in the quantity of eBook readers sold is ambiguous. B) it is clear that prices will decrease, the change in the quantity of eBook readers sold is ambiguous. C) it is clear that quantity sold will increase, the change in the price of eBook readers is ambiguous. D) it is clear that quantity sold will decrease, the change in the price of eBook readers is ambiguous.