The difference between variable cost and fixed cost is that
a. fixed cost is paid even when there is no output
b. fixed cost is always falling as output increases
c. variable cost only increases for a while and then it decreases
d. fixed cost is always less than variable cost
e. fixed cost is not paid once production begins
A
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If goods X and Y are such that the cross price elasticity between them is negative, and if the income elasticity of X is negative, then these goods are
a. inferior complements b. luxury complements c. income elastic substitutes d. normal substitutes e. income elastic complements
Which of the following is not a reason for firms to merge?
a. to exercise greater market control b. to diversify asset holdings c. to increase control over suppliers d. to lower the Herfindahl-Hirschman Index e. to increase market share