Suppose that for each firm in the competitive market for potatoes, long-run average cost is minimized at $0.20 per pound when 500 pounds are grown. If the long-run supply curve is horizontal, then
A) some firms will enjoy long-run profits because they operate at minimum average cost.
B) the long-run price will be $0.20 per pound.
C) each consumer will purchase $100 worth of potatoes.
D) the long-run price will be set just above $0.20 per pound.
B
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The depression of the 1930s was
(a) the first depression in the nation's history. (b) not the first but the most serious depression in the nation's history. (c) not the first depression in the nation's history and no more serious than some of the others. (d) not as serious as the depressions of the 1840s and 1870s.
Empirical evidence on the U.S. economy suggests that household spending and income have an inverse relationship
a. True b. False Indicate whether the statement is true or false
There are two states of the world. In state one the person receives one hundred dollars. In state two the person receives fifty dollars. If the person is rational and their expected return is $87.50, then the probability with which state one occurs must be
a. 0.25. b. 0.50. c. 0.75. d. 1.00.
Social Security payments are indexed for inflation using
a. the CPI. b. the PPI. c. the GDP deflator. d. real interest rates.