To calculate average fixed cost, divide a firm’s ______ by its ______.
a. fixed cost; total output
b. variable cost; total fixed cost
c. marginal cost; total output
d. total cost; fixed output
a. fixed cost; total output
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Generating electricity creates air pollution. This industry, if left unregulated, will produce
A) more than the efficient level of output. B) the efficient level of output. C) less than the efficient level of output. D) sometimes more and sometimes less than the efficient level of output.
The only goods you consume are pizza and soda. Both are normal goods. You consider pizza and soda to be substitutes. Which of the following will lead you to eat more pizza?
A) The price of a pizza falls. B) The price of a soda falls. C) The price of a soda rises. D) Both answers A and C are correct.
If Jet Cruises chooses to No Ad, Easy Sail should ________ and earn ________ million in net profit.
Jet Cruises wants to prevent Easy Sail from entering the sailboat market. The above game tree illustrates the different strategies and corresponding payoffs for the two firms. Both Jet Cruises and Easy Sail have the same strategies of advertising (Ad) or not advertising (No Ad). The payoffs represent net profit in millions.
A) Ad; $4 B) No Ad; $10 C) No Ad; $2 D) Ad; $10
Macroeconomics involves the study of the decision-making of individual firms or individuals.
Answer the following statement true (T) or false (F)