A perfectly competitive firm will be operating at its shutdown point if it operates
A. where P = MC.
B. at the minimum point on its average variable cost curve.
C. at the minimum point on its marginal cost curve.
D. at the minimum point on its average total cost curve.
Answer: B
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A firm should shut down in the short run if the price is less than the:
A) average fixed cost. B) average total cost. C) average variable cost. D) marginal cost.
Refer to Figure 13.1. All else equal, if the economy is in a recession, expansionary fiscal policy would result in a movement from
A) point A to point B. B) point B to point A. C) point B to point C. D) point C to point B.
There are no justifications for tax rates above the revenue-maximizing point
a. True b. False
A typical economic good has which one of the following characteristics?
A) The desired quantity exceeds the quantity available at a zero price. B) The quantity available exceeds the desired quantity at a zero price. C) It uses no resources to produce. D) It is never scarce.