One advantage of the specialization that results from international trade is that countries can take advantage of

In the above figure, between 20 and 25 units per hour, the firm experiences

A) economies of scale. B) diseconomies of scale. C) constant returns to scale. D) increasing total fixed costs.

Which of the following correctly describes the ceteris paribus assumption?

a. If we increase the price of a good, reduce consumer incomes, and lower the price of substitutes, and if quantity demanded is observed to fall, we know that the price increase caused that decline in quantity demanded. b. If the federal government increases government spending, and the Federal Reserve Bank lowers interest rates, we know that the increase in government spending caused unemployment to fall. c. If we decrease the price of a good and observe that there is an increase in the quantity demanded, holding all other factors that influence this relationship constant. d. If a company reduces its labor costs, negotiates lower materials costs from its vendors, and advertises, we know that the reduced labor costs are why profits are higher.