1 - Apple Inc expects to pay 1,000,000 in one month. The current spot rate is $1.35/. If the firm does nothing today, what is the risk facing the firm?

a. the pound may fall

b. the pound may rise

c. there is no risk

d. none of these choices are correct

2 - Whats true about the short-run and long-run in terms of production and cost analysis?

a. In the short-run, one or more of the resources are fixed

b. The time horizon determines whether or not an input variable is fixed or not

c. In the short-run, one or more of the resources are fixed

d. All of these choices are correct.

3-

An industry can be characterized by the following production function:

Q = 2.5L^.60 C^.40

^{If labor increases by 10%, production will go up by}

a. 6%

b. 4%

c. 0.4%

d. 0.6%

4- The main difference between perfect competition and monopolistic competition is:

a. Whether it is the short run or the long run

b. The number of sellers in the market

c. The degree of product differentiation

d. The ease of entry and exit in the industry

5- What is the profit maximization point for a firm in a purely competitive environment?

a. The output where P = MC

b. The output where P > MC

c. The output where AVC < P

d. The output where P < MC