Policies designed to promote import substitution often encouraged capital-intensive production methods.

If a firm is hiring inputs under purely competitive conditions, then any level of output will be produced with the least-cost combination of resources A and B when:

A. MU of A/price of A = MU of B/price of B B. MRP of A = MRP of B C. The price of A equals the price of B D. MP of A/price of A = MP of B/price of B

The long-run average cost curve

A. is a composite of short-run AC curves. B. shows the lowest possible short-run AC corresponding to each output level. C. depends on the firm’s planning horizon. D. All of the responses are correct.