When the average total cost curve is rising, the marginal cost curve will be
A. Below the average fixed cost curve.
B. Below the average total cost curve.
C. Above the average total cost curve.
D. Falling with greater output.
Answer: C
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When the economy suffers a permanent negative supply shock and the central bank does not respond by changing the autonomous component of monetary policy, then
A) inflation will be lower. B) output will be at its potential. C) output will be lower. D) inflation will not change. E) both A and B.
A business owned by two or more joint owners, or partners, who share the responsibilities and the profits of the firm and are individually liable for all the debts is a(n)
A) corporation. B) entrepreneur. C) proprietorship. D) partnership.
Consider a competitive industry in which a "green" company uses a cleaner but costlier production method than is used by other firms. In the long run, the "green" company will:
a. earn more profit than will the typical firm in the industry. b. drive its competitors out of business. c. have economic losses and exit the industry. d. charge a higher-than-average price for its product.
Economic profit is:
A. total revenues minus variable costs. B. total revenues minus implicit costs. C. total revenues minus explicit costs. D. total revenues minus explicit costs minus implicit costs.