The table below shows how the total cost of producing pottery vases varies with the number produced per day. The vases are sold in a perfectly competitive market, and the current equilibrium price is $50.
a. 4 vases per day.
b. 2 vases per day.
c. 5 vases per day.
d. 3 vases per day.
e. 1 vase per day.
d. 3 vases per day.
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If firms in a duopoly with homogeneous products compete on price, a Nash equilibrium is reached when each firm charges a price ________
A) equal to its average cost B) higher than its average cost C) equal to its marginal cost D) lower than its marginal cost
If the price of labor increases, the typical perfectly competitive firm in the short run will
A) produce more output. B) hire less labor. C) hire the same labor and produce the same output. D) hire more labor.
Members of the European Union (EU), rely heavily on this form of indirect taxes
a. Value-added tax b. Excise tax c. Property tax d. Sales tax
In a market where the forces of demand and supply operate without government intervention, the market price will
A. always be the equilibrium price. B. generally stay above the equilibrium price. C. generally stay below the equilibrium price. D. tend toward the equilibrium price.