If good X is a normal good and its price rises, then quantity demanded
a. may or may not fall.
b. will always fall.
c. will always rise.
d. will remain unchanged.
QUESTION 2The features of the M-Form of firm organization are
a. divisions have difficulty responding to market changes
b. it is difficult to maintain customer relationships
c. coordination across divisions is simple and does not take much management time
d. employee evaluation is hampered by managers often having different skill sets than those the manage
QUESTION 3Economies of scale exist when
a. long-run average costs decline as output increases.
b. long-run average costs are constant.
c. long-run average costs increase as output increases.
d. short-run average costs decline.
e. short-run average costs increase.
QUESTION 4Two goods, X and Y, are called complements if
a. an increase in PX causes more Y to be bought.
b. an increase in PX causes less Y to be bought.
c. an increase in PY causes less Y to be bought.
d. an increase in income causes more of both X and Y to be bought.
QUESTION 5The features of the M-Form of firm organization are
a. divisions have difficulty responding to market changes
b. it is difficult to maintain customer relationships
c. there is less coordination across the firm's divisions
d. evaluating employees is easier because managers typically are similarly trained
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