At its current level of quantity, a perfectly competitive firm's marginal revenue is $3.25, its short-run marginal cost is $3.25 and its long-run marginal cost is $3.25. Which of the following statements is true?
A) The firm is maximizing both its short-run and long-run profit.
B) The firm is maximizing its long-run profit, but not its short-run profit.
C) The firm is not maximizing its short-run or long-run profit.
D) The firm is maximizing its short-run profit, but not its long-run profit.
A) The firm is maximizing both its short-run and long-run profit.
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Indicate whether the statement is true or false
You hear that the price of gasoline will fall 20 cents overnight. This will tend to
A) increase your demand today. B) decrease your demand tomorrow. C) increase your demand tomorrow. D) leave your demand unchanged both today and tomorrow, especially if it is highly elastic to changes in prices.
________, in economics, refers to a preference for equal outcomes within the target population
A) Randomness B) Rationalism C) Fairness D) Liberalism
In a two-period model, as long as wealth effects are small, an increase in the world real interest rate
A) increases consumption and increases the current account surplus. B) increases consumption and decreases the current account surplus. C) decreases consumption and increases the current account surplus. D) decreases consumption and decreases the current account surplus.