In an industry where firms experience internal scale economies, the long-run cost of production will depend on
A) the size of the market.
B) the size of the labor force.
C) whether the country engages in intra-industry trade.
D) individual firms' fixed costs.
E) whether the country engages in inter-industry trade.
A
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Consider a PPC with automobiles on the vertical axis and cotton on the horizontal axis. The discovery of a new fertilizer that improves crop yield will shift:
a. the vertical intercept up but will not shift the horizontal intercept. b. the horizontal intercept to the right but will not shift the vertical intercept. c. the horizontal intercept to the left and the vertical intercept upward. d. the vertical intercept downward and the horizontal intercept to the right. e. neither the horizontal intercept nor the vertical intercept.
Consider a setting in which there is a negative externality, but no positive externality. It follows that
A) the market outcome is inefficient. B) the market outcome is efficient. C) MSC > MPC D) MPC > MSC E) a and c