If revenue in the short run is sufficient to offset variable costs but not all fixed costs, what should the firm do?

What will be an ideal response?


The firm should continue to produce in the short run but exit in the long-run if it expects economic losses to continue.

Economics

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A transfer payment is a payment by the government to an individual

A) for an investment good. B) for which the government does not receive a good or service in return. C) for a debt owed. D) for a service. E) for a consumption good.

Economics

The confidence problem of the Bretton Woods systems articulated by Robert Triffin refers to

A) the unwillingness of central banks to accumulate currency for fear of not being able to convert it to gold in case a run on the banks occurs. B) consumer fear of stock market instability. C) producer fear of rising wages. D) the lack of convertibility of gold into silver. E) low consumer spending because of balance of payment crises.

Economics

Planned investment spending is higher

A) when real interest rate is higher. B) during financial frictions. C) when businesses are optimistic. D) all of the above. E) A and C.

Economics

Table 8-2  Price Quantity Total Cost$22 6$ 60 2010100 1816160 1621210 1428280? In Table 8-2, the profit-maximizing level of output is

A. 6 B. 10 C. 16 D. 21

Economics