A firm that reduces its research and development spending will expect competitor firms to reduce research and development spending as competition is reduced.

The value of production generated by a country's factors of production within the borders of foreign countries during a particular year was $51,000 and the production of foreign factors of production within the borders of the country during that year

was worth $80,000. Which of the following is likely to be true in this case? A) The GDP of the country equals its trade balance. B) The GDP of the country is lower than its GNP. C) The GDP of the country is higher than its GNP. D) The GDP of the country equals its GNP.

A perfectly competitive ebook publishing firm currently sells its ebook at the market price of $6. Its average total cost is $5.50. In this case:

a. since average total cost is less than the price, the firm will shut down. b. the firm has positive economic profits. c. the firm is losing money but will continue to operate. d. the firm has zero economic profits.