Refer to the information provided in Figure 12.5 below to answer the question(s) that follow. 
Figure 12.5
Refer to Figure 12.5. Hula hoops are produced in a perfectly competitive market. This hula hoop firm is currently producing and selling 100 hula hoops per week. Which of the following is true?
A. Hula hoop production is at the efficient level because ATC is minimized.
B. Fewer resources should be devoted to hula hoop production because ATC is less than price.
C. Society would be better off if fewer hula hoops were produced because if this firm reduced its production, its profits would increase.
D. Society would be better off if more hula hoops were produced because at the current level of production price is greater than marginal cost.
Answer: D
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Refer to the figure above. If the government fixes a minimum wage rate at $25, the unemployment in the market will be:
A) 10 units of labor. B) 20 units of labor. C) 30 units of labor. D) 0 unit of labor.
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A) amplifies the effect of this disturbance on both domestic output and the domestic nominal money supply. B) amplifies the effect of this disturbance on domestic output and dampens the effect on the domestic nominal money supply. C) dampens the effect of this disturbance on domestic output and amplifies the effect on domestic nominal money supply. D) dampens the effect of this disturbance on both domestic output and the domestic nominal money supply.
Consider a monopolist with linear (inverse) demand p = a - bQ and constant average and marginal cost, c. Derive the monopolist's profit and the deadweight loss generated
Show that in such cases of linear demand and constant average and marginal cost, the deadweight loss is 50% of the monopolist's profits.
If the demand for labor is highly inelastic, an increase in wages secured by the union will cause a big increase in unemployment among union workers
Indicate whether the statement is true or false