Refer to Figure 18.1. Mutually beneficial terms of trade between the United States and Canada are
A) 1 hang glider for 1/2 of a bicycle. B) 1 hang glider for 1/4 of a bicycle.
C) 1 hang glider for 3 bicycles. D) 1 bicycle for 8 hang gliders.
A
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In a perfectly competitive market, the market price is $23. At the current level of output, a firm has a marginal cost of $28. What should the firm do?
A) produce a larger output to make more profit B) nothing, it is currently maximizing profit C) produce less output to make more profit D) shut down E) raise the price of its product
An increase in demand for DVD machines occurs. Which of the following statements is TRUE for individual firms that produce DVD machines?
A) The price of DVD machines will decrease leading to an increase in the demand for labor by the firm. B) The price of DVD machines will increase leading to an increase in the demand for labor by the firm. C) The price of DVD machines will increase leading to a decrease in demand by customers leading to a decrease in the demand for labor by the firm. D) A change in demand at the industry level does not influence an individual firm's demand curve for labor.