Figure 9.1 shows the cost structure of a firm in a perfectly competitive market. If the market price is $40 and the firm is currently producing the profit maximizing output level, its total fixed cost is:
A. $2,800.
B. $5,200.
C. $7,200.
D. $9,000.
Answer: C
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If aggregate expenditure in an economy equals 2,000 + 0.8Y and full employment real GDP equals 11,000, then this economy has
A. no output gap. B. no autonomous expenditure. C. a recessionary gap. D. an expansionary gap.
What brought about the end of the Bretton Woods Agreement?
What will be an ideal response?
The balance of payments ____________
a. is always zero b. is always one c. is positive when the nation has a trade surplus d. is negative when the nation has a trade deficit e. is positive when the nation has a trade deficit
Between 1994 and 2004, the monthly charge for cellular phone service decreased from $120 per month to $30 per month. At the same time, the number of subscribers increased from less than 10 million to more than 75 million. Which of the following provides the best explanation for these changes?
a. an increase in consumer income between 1994 and 2004 b. a reduction in the price of residential phone service, a substitute for cellular phone service c. an increase in the wages of workers in the cellular phone industry d. technological improvements that reduced the cost of supplying cellular phone service