What differentiates an increasing-cost industry from a decreasing-cost industry?
What will be an ideal response?
An increasing-cost industry is an industry that has external diseconomies of scale. This implies that the long-run industry supply curve is upward sloping. A decreasing-cost industry has external economies of scale. In this type of industry, the long-run industry supply curve is downward sloping.
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In which type of trade agreement does the WTO allow exclusions to the most favored nation principle?
a. multilateral trade agreements b. free-trade areas c. customs unions d. free-trade areas and customs unions
Goodland is currently operating at full capacity. The country experienced a sudden boom in economic activity. However, the unemployment rate increased soon afterwards. What is likely to have caused such a phenomenon?
What will be an ideal response?