If the production possibilities curve in France is bowed out and the curve in Spain is a straight line, then we know that
a. no trade can take place between France and Spain
b. the terms of trade will always be in favor of France
c. the terms of trade will always be in favor of Spain
d. the law of increasing costs apply to France but not to Spain
e. the law of increasing costs apply to Spain but not to France
f. the opportunity costs of producing goods in France are constant
D
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Assume a perfectly competitive firm is producing 300 units of output, P = $10, ATC of the 300th unit is $8, marginal cost of the 300th unit = $10, and AVC of the 300th unit = $6. Based on this information, the firm is:
A) earning an economic profit of $600. B) earning an economic profit of $1,200. C) incurring a loss of $600. D) incurring a loss of $1,200.
On a graph showing investment along the vertical axis and income along the horizontal axis, _____
a. the investment line will be downward sloping b. the investment line will be upward sloping c. the investment line will be horizontal d. the investment line will be vertical e. the investment line will be U-shaped