Refer to the graph shown. If the market price is $3, a perfectly competitive firm:

A. incurs a loss but can still cover its variable costs and some of its fixed costs.
B. earns a profit.
C. breaks even.
D. incurs a loss and cannot cover its variable costs.


Answer: D

Economics

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a. overstate the progressive nature of the tax system b. overstate the regressive nature of the tax system c. understate the progressive nature of the tax system d. overstate the regressive nature of the tax system

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According to a survey by the U.S. Bureau of Labor Statistics, which of the following statements about annual U.S. household consumer expenditures is false?

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Economics

If one dollar is initially equal in value to one euro and demand for euros increases, then each dollar will be worth

a. more than one euro, and European imports will be cheaper in the United States b. less than one euro, and European imports will be more expensive in the United States c. more than one euro, and European imports will be more expensive in the United States d. less than one euro, and European imports will be cheaper in the United States e. the same as the euro, and there will be no change in the values of imports or exports

Economics

From 2001 to 2004 the U.S. budget went from surplus to deficit. According to the open economy macroeconomic model, this change should have

a. increased U.S. interest rates and increased the real exchange rate of the dollar. b. increased U.S. interest rates and decreased the real exchange rate of the dollar. c. decreased U.S. interest rates and increased the real exchange rate of the dollar. d. decreased U.S. interest rates and decreased the real exchange rate of the dollar.

Economics