Author Question: A stronger dollar leads to lower input prices for U.S. firms because A) U.S. workers are willing ... (Read 74 times)

CORALGRILL2014 · **on:** Jun 30, 2018

A stronger dollar leads to lower input prices for U.S. firms because

A) U.S. workers are willing to work for less pay because of the stronger dollar.
B) U.S. producers of intermediate goods lower prices in order to benefit from the stronger dollar.
C) both exports of raw materials and intermediate goods are lower in prices.
D) both imports of raw materials and intermediate goods are lower in prices.

Question 2

The principal of optimization at the margin states that:

A) moving toward the optimal alternative makes the decision maker worse off, and moving away from it, makes the decision maker better off.
B) an optimal alternative has the lowest indirect costs in comparison to other feasible alternatives.
C) an optimal alternative has the highest net benefits in comparison to other feasible alternatives.
D) moving toward the optimal alternative makes the decision maker better off, and moving away from it makes him worse off.

Assume that there are five apartments located at different distances from an individual's place of work: very close, close, far, very far, and extremely far. The individual makes his choice by studying the change in costs as he moves farther from his place of work. She has to choose between renting one of the five apartments. The movement from apartment Very Close to Close has a marginal cost of -60, a movement from apartment Close to Far has a marginal cost of -40, a movement from apartment Far to Very Far has a marginal cost of -10, and a movement from apartment Very Far to Extremely Far has a marginal cost of 20.