Economists assume the principal motivation of producers is
A. Psychological gratification.
B. Profit.
C. Social status.
D. Their preference for being "their own person."
Answer: B
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Suppose a firm is a natural monopoly. Then, until the long-run average cost curve crosses the demand curve, as the quantity increases the long-run average costs
A) increase. B) decrease. C) decrease and then increase. D) increase and then decrease.
If a perfectly competitive firm's total revenue is less than its total variable cost, the firm
A) should continue to produce and increase its demand. B) should stop production by shutting down temporarily. C) should raise its price above its average variable cost. D) should adopt new technology in order to lower its costs of production.
The least liquid of the following assets is
a. cash in the hands of the public b. time deposits c. savings accounts d. travelers' checks e. demand deposits
What is the total welfare from trade as shown in Exhibit 2?
a. + a
b. + d
c. a + b + c + e + f
d. a + b + c + d + e + f