Author Question: Which of the following best applies to the distinction between the long run and the short run? A) ... (Read 22 times)

Shelles

  • Hero Member
  • *****
  • Posts: 582
Which of the following best applies to the distinction between the long run and the short run?
 
  A) The short run is a period of approximately 1-6 months while the long run is any time frame which is longer.
  B) In the short run, only new firms may enter, while in the long-run firms may either enter or exit the market.
  C) The rationing function of price is a short-run phenomenon whereas the guiding function is a long-run phenomenon.
  D) All of the above statements are correct.

Question 2

Consider a society consisting of just a farmer and a tailor. The farmer has 10 units of food but no clothing. The tailor has 40 units of clothing but no food. Suppose each has the utility function U = F  C. The price of clothing is always 1.
 
  What is the competitive equilibrium price for food? A) 5
  B) 4
  C) 3
  D) 2



millet

  • Sr. Member
  • ****
  • Posts: 354
Answer to Question 1

C

Answer to Question 2

B



Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
 

Did you know?

For high blood pressure (hypertension), a new class of drug, called a vasopeptidase blocker (inhibitor), has been developed. It decreases blood pressure by simultaneously dilating the peripheral arteries and increasing the body's loss of salt.

Did you know?

On average, the stomach produces 2 L of hydrochloric acid per day.

Did you know?

Bacteria have been found alive in a lake buried one half mile under ice in Antarctica.

Did you know?

Although the Roman numeral for the number 4 has always been taught to have been "IV," according to historians, the ancient Romans probably used "IIII" most of the time. This is partially backed up by the fact that early grandfather clocks displayed IIII for the number 4 instead of IV. Early clockmakers apparently thought that the IIII balanced out the VIII (used for the number 8) on the clock face and that it just looked better.

Did you know?

A cataract is a clouding of the eyes' natural lens. As we age, some clouding of the lens may occur. The first sign of a cataract is usually blurry vision. Although glasses and other visual aids may at first help a person with cataracts, surgery may become inevitable. Cataract surgery is very successful in restoring vision, and it is the most frequently performed surgery in the United States.

For a complete list of videos, visit our video library