If the economy is at point R, most likely this economy is experiencing __________.
a recession
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A firm has excess capacity if its output is
A) less than the quantity at which marginal cost is minimized. B) less than the quantity at which economic profit is maximized. C) less than the quantity at which average total cost is minimized. D) more than the quantity at which average total cost is minimized.
Refer to Figure 4-7. The figure above represents the market for iced tea. Assume that this is a competitive market. Which of the following is true?
A) If the price of iced tea is $3, producers will sell 30,000 units of iced tea but this output will be economically inefficient. B) If the price of iced tea is $3, consumers will purchase more than the economically efficient output. C) Both 10,000 and 30,000 are economically inefficient rates of output. D) If the price of iced tea is $3, the output will be economically efficient but there will be a deadweight loss.
For a firm with market power, advertising expenditures affect all of the following except which one?
A) demand curve B) fixed cost C) marginal cost D) total cost
What is the average cost per unit if the firm produces 5 units?
a. $196 b. $980 c. $182 d. $910