Whether a firm stays in business or shuts down depends heavily on the concept of
A. market share.
B. economic profit.
C. actual profit.
D. concentration ratios.
Answer: B
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Which economist(s) first identified an inverse relationship between inflation and unemployment?
a. Robert Lucas and Thomas Sargent. b. W. Phillips. c. Robert Barro. d. Paul Samuelson. e. Arthur Laffer.
Which of the following statements is true?
A. The United States today comes closer to the socialist form of economic organization than it does capitalism. B. When central planners set prices above equilibrium for goods and services they create shortages. C. According to Karl Marx, under capitalism, workers would be exploited and would revolt against the owners of capital. D. Adam Smith argued that government's role in society would be to do absolutely nothing.
In Figure 12.6, airline Fly Smart is initially a secure monopoly between two cities X and Y at point M, serving 300 passengers per day at the profit maximizing price of $300 per ticket. Suppose that Fly Smart discovers that a second airline is contemplating entering the market. If the minimum market entry quantity is zero passengers per day, what is Fly Smart's profit when it commits to the entry-deterring quantity?
A. $60,000 B. $44,400 C. $33,600 D. $0
As output decreases, average fixed costs
A. initially decrease and then increase. B. decrease. C. increase. D. remain constant.