A monopolist maximizes its profit by producing the amount of output that sets
A) total revenue equals total cost.
B) marginal revenue equals marginal cost.
C) marginal revenue equals zero.
D) price equals marginal cost.
B
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Suppose you bank at Bank A and you write a check to your friend, who banks at Bank B. After the check clears, _____
a. both Bank A's and Bank B's assets increase b. both Bank A's and Bank B's assets decrease c. Bank A's assets increase and Bank B's assets decrease d. Bank A's assets decrease and Bank B's assets increase e. there is an increase in the Federal Reserve's assets
The production possibilities curve illustrates the basic principle that
a. an economy's capacity to produce is unrelated to its population. b. if all the resources of an economy are being used efficiently, more of one good can be produced only if more of another good is produced. c. an economy will automatically move toward a point at which all of its resources are being used inefficiently. d. if all the resources of an economy are being used efficiently, more of one good can be produced only if less of another good is produced.
If sellers have more information about the quality of goods than do buyers, then:
A. sellers of better-than-average goods will have difficulty getting their asking price. B. buyers will never make purchases. C. buyers always will be exploited. D. sellers of lower-than-average goods will have difficulty getting their asking price.
With a call option that is described as in the money:
A. the option has been exercised. B. the market price of the stock is below the strike price. C. the market price of the stock is above the strike price. D. the market price of the stock equals the strike price.