These are the cost and revenue curves associated with a monopolistically competitive firm.
According to the graph shown, area A represents:
A. profits earned in the short and long run.
B. profits earned in the short run.
C. consumer surplus.
D. profits earned in the long run.
Answer: B
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A subsidy:
A. increases the amount that buyers pay for a good. B. reduces the amount that buyers pay for a good. C. reduces both the amount that buyers pay and the amount sellers receive for a good. D. increases both the amount that buyers pay and the amount sellers receive for a good.
As the price elasticity of supply approaches infinity, very small changes in price lead to
a. very large changes in quantity supplied. b. very small changes in quantity supplied. c. no change in quantity supplied. d. None of the above is correct.
Which of the following explains why the aggregate demand curve is downward sloping?
A. the interest rate effect B. the open economy effect C. the real-balance effect D. all of these
Refer to the information provided in Figure 6.15 below to answer the question that follows.
Figure 6.15Refer to Figure 6.15. Jason is not maximizing his utility at point
A. E. B. B. C. C. D. All of the above are correct.