When Wal-Mart decides to build a new retail store in a town, it will decide to build a large store rather than a small store if the large store is expected to earn a greater economic profit
What other motive would Wal-Mart have for choosing to build a large store?
A) A larger store will help Wal-Mart maintain its position as the leading retail company in the world more than a smaller store would.
B) Because of economies of scale, the average total cost of production is less for a larger store than a smaller store.
C) A larger store will give Wal-Mart greater political influence in the community.
D) A larger store may deter entry into the town by a rival firm.
D
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The multiplier effect is the series of ________ increases in ________ expenditures that result from an initial increase in ________ expenditures
A) induced; investment; autonomous B) induced; consumption; autonomous C) autonomous; consumption; induced D) autonomous; investment; induced
Governments choose to mandate participation in a program, like auto insurance, when:
A. the functioning of those markets is thought to be in the public interest. B. the market would not otherwise exist. C. the market would exist illegally. D. None of these statements is true.