If a firm in the long run produces less than its efficient scale, it
A) should raise its markup to increase its profit.
B) should lower its markup to increase its profit.
C) cannot be a perfectly competitive firm.
D) should not advertise to increase its profit.
E) must have its markup equal to zero.
C
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The BP curve shifts to the left when:
a. the exchange rate falls. b. interest rates rise. c. income rises. d. imports increase.
Mario's Pizza wants to prevent Angelo's Pizza from entering the pizza delivery market. If Mario's Pizza advertises that it will always undercut any competitor's price, the effect of advertising ________ Mario's Pizza's profits due to its cost and ________ Mario's Pizza's profits due to a(n) ________ in its demand.
A) increases; increases; increase B) decreases; decreases; increase C) decreases; decreases; decrease D) decreases; increases; increase
Refer to the above figure. Saving occurs at
A) only at point A. B) to the left of point B. C) only at point B. D) to the right of point B.
Investment spending might be larger when GDP is higher. Such added investment as GDP rises is called
A. mutual investment. B. induced investment. C. positive investment. D. net investment.