Acme Steel Co produces 1000 tons of steel. Steel sells for $30 per ton. Acme pays wages of $10,000. Acme buys $15,000 worth of coal, which is needed to produce the steel. Acme pays $2,000 in taxes. Acme's profit is
A) $0.
B) $2,000.
C) $3,000.
D) $15,000.
C
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A company finds that at its present level of production, MC = AVC at $15, MC = ATC at $20, and MC = MR at $17. Your advice to the firm regarding its short-run operations is
A) to continue production, as it is earning an economic profit of $2 per unit. B) to continue production, as it is earning an economic profit of $3 per unit. C) to shut down. D) to continue production at a loss.
The aggregate supply and aggregate demand model is used to explain the:
A. overall health of the economy. B. overall effect of large markets within the economy. C. interaction of all sellers and all buyers within a particular market. D. way that unemployment may affect output, but not how price level does.
Which of the following is true about average fixed cost?
A. Average fixed cost has a U-shape, and marginal cost crosses average fixed cost at its minimum point. B. Average fixed cost does not vary as output increases. C. Average fixed cost is the difference between marginal cost and average total cost. D. Average fixed cost is total fixed cost divided by the quantity of output produced, and it declines steadily as output increases.
If the population of a country is 250,000 people, its labor force consists of 145,000 people, 35,000 people are unemployed, 10,000 are unable to work, and 5,000 are unwilling to work, the unemployment rate is
A. 24.1 percent. B. 22.1 percent. C. 19.4 percent. D. 14.0 percent.