In the above figure, what happens to the firm's optimal level of output if the price it receives for its product decreases from P4 to P3?
A. Output increases.
B. Output stays the same.
C. Output decreases.
D. There is not enough information provided to know what happens to output.
Answer: C
You might also like to view...
There are several assumptions that are the basis of the operation of the benchmark competitive labor market. Which of the following is not one of these assumptions?
A. Wage rates are costlessly observable. B. Compensation is made up of wages and benefits. C. There are no long-term contracts. D. All jobs are identical.
Market quantity demanded measures the amount of the product that people in the market want to buy
A. per unit time, such as a day or week. B. if the sellers in the market force them to buy. C. if the government subsidizes their purchase. D. per person.
Suppose the market for Blu-rays has the demand and supply schedules shown in the table above. Suppose a technological advance increases the quantity of disks supplied at each price by 25 million
What is the new equilibrium price and the new equilibrium quantity of Blu-rays?
In a system in which all banks have a uniform reserve requirement, the money multiplier is equal to 1 divided by the prime rate
a. True b. False Indicate whether the statement is true or false