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A fast-food company spends millions of dollars to develop and promote a new hamburger on its menu only to find that consumers won't buy it because they don't like the taste. From an economic perspective, the company should:
A - keep the hamburger on the menu because they've spent so much money and time developing and promoting the product.
B - spend more money to develop a more efficient way to cook the hamburger so it cooks in a shorter time.
C - pull the hamburger off the menu and treat the development and promotion expenditures as a sunk cost.
D - keep trying to sell the hamburger so that people who developed and promote it have a job with the company.
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The manager of a paper mill is making for her most important test yet. On Tuesday morning, she must testify before a senate committee to justify company's high value.
Assume that one nation subsidizes is exports and other country imposes a countervailing tariff that offsets effects, so that in the end relative prices in the second country are unchanged.
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What would be the price of steel in the United States if a policy of "self-sufficiency" were established and no imports were allowed? How many tons of steel would be produced?
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