Prove that the total cost curve and the total variable cost curve have the same slope
What will be an ideal response?
Total cost is achieved by adding TFC to TVC. This means adding the same amount of total fixed cost to every level of total variable cost. Thus, the total cost curve has the same shape as the total variable cost curve; it is simply higher by an amount equal to TFC.
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Which of the following is NOT a device to reduce transaction costs?
A) shopping centers B) auto dealers located close together C) government prohibitions on advertising D) banks that direct funds from savers to borrowers
To practice price discrimination, a firm:
a. must face a relatively elastic demand curve. b. must have customers with different elasticities of demand. c. must not be able to distinguish between customers based on elasticities of demand. d. must not be able to prevent resale of the product. e. must be a price taker.
If there are cost differences in transporting goods produced on different acres of land to the same market,
a. only land closest to the market will be cultivated b. landowners closest to the market will receive zero rent c. location rents emerge d. the market price and the supply price will be the same e. transportation costs will be equalized by competition
Disposable income is what households have to spend or to save.
Answer the following statement true (T) or false (F)