If a perfectly competitive firm operates in the short run but exits the industry in the long run, then the firm's short run condition is
A. TR > TC.
B. TR > TVC and TR < TC.
C. TR < TVC.
D. TR < TFC.
Answer: B
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A market demand curve measures
A) how much a consumer is willing to pay for an additional unit of the good. B) the marginal social benefit of an additional unit of the good. C) the marginal social cost of an additional unit of the good. D) Both answers A and B are correct.
Answer the following statements true (T) or false (F)
1. A good tax must possess the characteristic of equality. 2. If the cost of collecting a tax is low relative to the revenue generated, the tax is said to be economical. 3. Interest on the national debt is an insignificant part of the U.S. federal budget. 4. In the United States, income is taxed only by the federal government. 5. The equality-of-sacrifice doctrine would require larger taxes from higher-income groups.
When supply is written as Q = c + dP and P and Q are the equilibrium values for price and quantity, which of the following is the value of the price elasticity of supply, ES?
A. -c/d B. c(P/Q) C. -d/c D. d(P/Q)
The key to increasing economic growth is to ____
a. increase tax rates b. increase labor productivity c. increase inflation d. increase population growth e. increase the level of federal govt spending