When a Japanese Company Buys a U

question 182

Multiple Choice

When a Japanese company buys a U.S. software company, this transaction will be a(n)

• A)credit on the current account of the U.S. balance of payments.
• B)debit on the current account of the U.S. balance of payments.
• C)inflow of money on the financial account of the U.S. balance of payments.
• D)outflow of money on the financial account of the U.S. balance of payments.

Identify examples of industries that reflect characteristics of monopolistic competition.

Understand the concept of excess capacity in monopolistically competitive markets.

Comprehend the pricing behavior of monopolistically competitive firms in the short and long run.

Identify measures of industry concentration and their implications.

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Definitions:

Average Total Cost

The per-unit cost of production, obtained by dividing total costs by the total quantity of goods or services produced.

Marginal Cost

The expenditure for assembling another unit of a product or service.

Short-Run Equilibrium

A state in which market supply and demand balance each other, and as a result, prices become stable for a short period.

Constant Returns

A situation in economics where increasing the scale of production does not affect the long-run average cost of production, implying it remains constant.