In the short run, if a perfectly competitive firm is producing at a price below average total cost, its economic profit is:
a. positive.
b. negative.
c. zero.
d. normal.
b
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Vault cash is equal to $2 million, deposits by depository institutions at the central bank are $1 million, the monetary base is $15 million, and bank deposits are $30 million. Bank reserves are equal to
A) $2 million. B) $3 million. C) $5 million. D) $10 million.
A singer would willingly perform in a concert for $100,000. If she is paid $500,000 for the concert, she is
A) receiving $500,000 to cover her opportunity cost. B) not being paid her full opportunity cost. C) receiving $400,000 of economic rent. D) certainly being paid more than warranted by the level of demand.
The wealth effect explains the:
A. negative relationship that exists between consumer spending and overall price level. B. positive relationship that exists between consumer spending and overall price level. C. negative relationship that exists between consumer spending and overall asset valuation. D. positive relationship that exists between consumer spending and overall asset valuation.
One point on a market supply curve represents $4 and 100 units quantity supplied. If there are three suppliers, and at a price of $4 one of the suppliers supplies 23 units, then which of the following combinations of price and quantity supplied might hold for the other two suppliers?
A) At $4, quantity supplied could be 40 units for one supplier and 27 for the other. B) At $4, quantity supplied could be 33 units for one supplier and 27 for the other. C) At $4, quantity supplied could be 40 units for one supplier and 37 for the other. D) At $4, quantity supplied could be 77 units for one supplier and 10 for the other. E) There is not enough information to answer this question.