A firm would decide to shut down if its production resulted in
A) MR < ATC.
B) ATC > AVC.
C) AFC > AVC.
D) MR < AVC.
Answer: D
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When an oligopoly market is in Nash equilibrium
A) a firm will choose its best pricing strategy, given the strategies that it observes other firms have taken. B) firms will not behave as profit maximizers. C) firms have colluded to set their prices. D) a firm will not take into account the strategies of its rivals.
Define incrementalism and give two reasons why incrementalism might be efficient
What will be an ideal response?
Computer forecasting models are most accurate at predicting the economy when
a. inflation is accelerating. b. there is a turn in the business cycle. c. economic conditions are relatively stable. d. supply shocks impact the economy.
In an open economy with a given level of real interest rates and risk, an increase in real interest rates abroad will ________ capital inflows and ________ the equilibrium domestic real interest rate.
A. decrease; increase B. decrease; decrease C. increase; decrease D. increase; increase