If the price of a cup of Dunkin' Donuts coffee increases while the price of a Starbucks latte is unchanged, we expect the number of lattes purchased at Starbucks to:
A. increase as some people switch from Dunkin' Donuts coffee to Starbucks lattes.
B. decrease as some people switch from Dunkin' Donuts coffee to the Starbucks lattes.
C. decrease as some people have less money to spend on caffeinated beverages.
D. decrease as some people switch from Starbucks lattes to Dunkin' Donuts coffee.
A. increase as some people switch from Dunkin' Donuts coffee to Starbucks lattes.
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If the average total cost of producing 20 sweaters an hour falls when the firm doubles all its inputs, then the
A) short-run average total cost curve shifts upward because all inputs have increased. B) firm moves along its short-run average total cost curve. C) firm experiences economies of scale. D) long-run average cost curve shifts downward.
Jeremy is thinking of starting up a small business selling NASCAR memorabilia. He is considering setting up his business as a sole proprietorship. What is one disadvantage to Jeremy of setting up his business as a sole proprietorship?
A) As a sole proprietor, Jeremy would face unlimited liability. B) As a sole proprietor, Jeremy would be subject to significant rules and regulations. C) As a sole proprietor, Jeremy would be taxed twice. D) As a sole proprietor, Jeremy would not have control of the business.