Refer to the information provided in Table 8.6 below to answer the question(s) that follow.
Table 8.6
Refer to Table 8.6. If the firm is in a perfectly competitive industry with a market price of $15 per unit, the firm will produce ________ units and earn a profit of ________.
A. three; $10
B. five; $15
C. four; -$10
D. four; $10
Answer: C
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For a single-price monopoly,
A) if marginal cost exceeds marginal revenue, profits will increase if output decreases. B) if marginal revenue exceeds marginal cost, profits will increase if output decreases. C) there are several different price and output combinations that maximize profit. D) marginal revenue will be greater than price if demand is elastic. E) marginal revenue will be greater than price if demand is inelastic.
The excess burden of the corporate income tax is
A. almost zero. B. greatest when the interest elasticity of saving is zero. C. a result of the combined distortion in the pattern of investment and a reduction in total investment. D. none of these answer options are correct.
All of the following would be potential problems if developing nations around the world emphasized export promotion EXCEPT
A) industrial nations may be unable to absorb the exports of many newly industrializing nations. B) it would be much harder to emphasize exports under the WTO framework if the emphasis in exports requires some kind of subsidies. C) export growth may not add to GDP if it crowds out growth in output of goods for domestic consumption. D) export promotion by many countries may lead to economic conflicts. E) current research has clearly established that there is no causal connection between exports and faster economic growth.
In New Keynesian macroeconomics, when marginal costs are too sticky to change in proportion to nominal aggregate demand, prices ________ and so menu costs ________ needed to explain business cycles
A) are also sticky, are B) are also sticky, are not C) are still perfectly flexible, are D) are still perfectly flexible, are not