A Constant-Cost Industry

question 103

Multiple Choice

A constant-cost industry

• A) is one in which an increase in demand is matched by a proportional increases in long-run supply.
• B) generates increasing profits whenever demand increases because the new long-run equilibrium price is above the old price even though average costs have not changed.
• C) has a horizontal long-run supply curve.
• D) has a downward sloping long-run supply curve.

Understand the concept of proper presentment and notice requirements in negotiable instruments.

Grasp the nuances of endorser liability and the order of liability among endorsers and makers of promissory notes.

Comprehend the legal implications of unauthorized signatures and their ratification.

Recognize the conditions under which alterations to promissory notes affect liability.

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Definitions:

Productive Efficiency

A situation where an economy or a production process is not able to produce more of one good without reducing the production of another good, operating on its production possibilities frontier.

Economy

A system of production, distribution, and consumption of goods and services within a particular geographic area.

U.S. Economy

The economic system of the United States, characterized by a combination of free-market and planned economic activities, and is one of the largest economies globally.

Unemployment Rate

The chunk of the labor force that finds itself unemployed and in active pursuit of a job.