A pair of running shoes costs $70 in the U.S. If the price of the same shoes is 4500 rupees in India and the exchange rate is 60 rupees per dollar, than the real exchange rate is
a. more than 1, so a profit could be made by buying these shoes in the U.S. and selling them in India.
b. more than 1, so a profit could be made by buying these shoes in India and selling them in the U.S.
c. less than 1, so a profit could be made by buying these shoes in the U.S. and selling them in India.
d. less than 1, so a profit could be made by buying these shoes in India and selling them in the U.S.
c
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In the market for resources, demand and supply:
a. do not behave in the same way as they do in product markets. b. behave in exactly the same way as they do in product markets. c. curves usually do not intersect at equilibrium. d. are both controlled by firms. e. are both controlled by households
A monopolist is producing at an output level at which ATC = $5, P = $6, MC = $3, and MR = $4. We can conclude that
A) economic profit could be increased by producing more. B) economic profit could be increased by producing less. C) economic profit cannot be increased. D) the firm is earning $10 in economic profits.