If a competitive firm cannot earn a profit at any level of output during a given short-run period, then which of the following is FALSE?
A) It will shut down in the short run and wait until the price increases sufficiently.
B) It will exit the industry in the long run.
C) It will operate at a loss in the short run.
D) It will minimize its loss by decreasing output so that price exceeds marginal cost.
D
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Empirical evidence suggests that saving tends to rise when there is an increase in interest rates. What does this imply about the relative sizes of the income and substitution effects? Explain
What will be an ideal response?
Helga owns Viking, Inc, started with her $100,000 inheritance. Helga's accountant informs her that her firm earned a profit of $100,000 last year, and that if she chooses to invest the money she can expect a 10% return. If Helga did not run Viking, she would not work. What were Helga's economic profits last year?
a. Zero b. $100,000 c. $90,000 d. $95,000
Which of the following statements is true?
a. Private international foreign exchange transactions affect the monetary base. b. Both private foreign exchange transactions and central bank interventions in the foreign exchange market affect the monetary base. c. Neither private foreign exchange transactions nor central bank interventions in the foreign exchange market affect the monetary base. d. Central bank interventions in the foreign exchange market affect the monetary base.
If the two countries are at points A and B in Figure 35.1 and do not trade, what is the total number of motorcycles produced per year?
A. 2,000. B. 3,000. C. 4,000. D. 1,000.