If marginal revenue exceeds marginal cost, profit maximizers should:
a. reduce output until they are equal.
b. increase output until they are equal.
c. increase output until profits are zero.
d. decrease output unless profits are zero.
e. maintain current output.
b
You might also like to view...
Fill in the blank: Firms under perfect competition would enjoy ________ market power
A) absolutely no B) some C) much D) total
The implication of the expectations theory that expected returns for a holding period must be the same for bonds of different maturities depends on the assumption that
A) yield curves usually slope upward. B) yield curves usually slope downward. C) instruments with different maturities are perfect substitutes. D) savers are usually risk averse.
Which of the following best describes the relationship between economic growth and literacy? a. As the economy grows, literacy declines because it becomes less and less useful in a developed economy
b. Increased literacy initially stimulates economic growth by raising labor productivity, but as the economy grows and the opportunity cost of education rises, literacy declines. c. Increased literacy stimulates economic growth by raising labor productivity, and as the economy grows, people consume more education. d. There is no correlation between economic growth and literacy.
Which of the following is not true for a public good?
a. Marginal cost of serving public good to one more person is zero. b. Free rider problem arises in case of public goods. c. Exclusion is not possible in most of the public goods. d. Public goods include only material commodities.