Explain the relationship between price, short-run marginal cost, short-run average cost and long-run average cost in the final long-run competitive equilibrium condition. What are economic profits in this long-run equilibrium condition?
What will be an ideal response?
P = SRMC = SRAC = LRAC. Economic profits are zero.
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A) is equal to the marginal rate of substitution. B) always equals the relative price of the product measured along the horizontal axis. C) increases as income increases. D) decreases when income increases.
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A) raises the average quality of hair cuts. B) increases the costs of getting a hair cut. C) may increase or decrease welfare. D) All of the above.
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A) to provide loans to the federal government. B) to regulate the money supply. C) to set the legal, controlled consumer interest rates. D) to lend to risky customers.
Which of the following is a liability to a bank?
A) total reserves B) transaction deposits C) government securities D) loans