If a firm is operating in the range of economies of scale, and if it is currently at the minimum point of its short-run average total cost curve, explain what action it can take to reduce its costs, if it does not want to change the quantity of output that it is producing
It can increase its fixed capital. This will move it to a new short-run average total cost curve that is closer to
(or tangent to) the envelope curve at the desired level of output.
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The core rate of inflation is a measure of the relative price changes that excludes changes in energy and food prices
Indicate whether the statement is true or false
Your classmates from the University of Chicago are planning to go to Miami for spring break, and you are undecided about whether you should go with them. The round-trip airfare is $600, but you have a frequent-flyer coupon worth $500 that you could use to pay part of the airfare. All other costs for the vacation are exactly $900. The most you would be willing to pay for the trip is $1,400. Your only alternative use for your frequent-flyer coupon is for your trip to Atlanta two weeks after the break to attend your sister's graduation, which your parents are forcing you to attend. The Chicago-Atlanta round-trip airfare is $450. Should you use the frequent flyer coupon to go to Miami?
A. No, because there are no benefits in the trip. B. Yes, your benefit is more than your cost. C. No, your benefit is less than your cost. D. Yes, your benefit is equal to your cost.