Which statement is true of the graph shown? 
A. The shut down point of the firm would be at an output more than Q*.
B. The marginal cost curve crosses the AFC curve at the lowest point of the AFC curve.
C. The marginal cost curve should not cross the AFC while it is falling.
D. If an ATC curve was drawn in the graph it would intersect the MC curve but not any other curve.
Answer: D
You might also like to view...
Suppose a presidential candidate campaigns on the need to improve U.S. infrastructure, a term for capital goods like bridges, highways, and technology (much of it publicly owned). Which would lead to faster growth: government expenditure on capital goods or expenditure on consumption goods such as sports stadiums? Illustrate your answer, drawing appropriate production possibilities frontiers accompanied by an explanation.
What will be an ideal response?
The complete wage and price flexibility of the real business cycle framework implies that ________
A) the velocity of money is a constant B) the velocity of money times the money supply is equal to the nominal value of transactions over a given period of time C) aggregate output always equals potential output D) sustained economic contractions, like the Great Depression, cannot occur in real, historical time
When an economy experiences deflation, investment will:
A. decrease, because businesses will not take out loans that will increase in value over time. B. increase, because businesses will take out loans that will increase in value. C. decrease, because businesses will spend cash instead of borrowing it. D. increase, because businesses will spend cash instead of borrowing it.
If demand is elastic, an increase in price will decrease total revenue
a. True b. False Indicate whether the statement is true or false