If the firm is maximizing profits or minimizing losses, it is producing _____ units of output and charging a price of ______.
A. 40; $10.00
B. 40; $18.00
C. 50; $13.00
D. 55; $14.00
B. 40; $18.00
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Which of the following is a true statement about the multiplier?
a. The multiplier rises as the MPC rises. b. The smaller the MPC, the larger the multiplier. c. The multiplier is a value between zero and one. d. The multiplier effect does not occur when autonomous expenditure decreases.
In the case of nonexcludable goods, economists contend that the market ___________ produce these goods because of the ________________________.
A. will; free rider problem B. will not; law of diminishing marginal utility C. will not; law of diminishing marginal returns D. will not; free rider problem.
In the U.S. economy, the effect on federal tax revenues and spending of a decrease in employment is to:
a. cut tax revenues and raise expenditures. b. cut spending and raise tax revenues. c. raise both tax revenues and expenditures. d. cut both spending and tax revenues.
If fluctuations in economic activity come from the supply side, higher inflation is associated with
A. lower interest rates. B. structural deficits. C. higher rates of unemployment. D. lower rates of unemployment.