If a business firm is not operating at the point where MR = MC, then:
a. it should shut down.
b. it will incur losses.
c. it cannot be earning a profit.
d. its profit is zero.
e. it is not earning the maximum potential profit.
e
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Sam is responsible for ordering office supplies for the firm gets a bonus if the firm stays well-stocked at all times. The bonus implies he is more likely to
a. Pay lower prices for the supplies b. Pay higher prices for the supplies c. Have more stock outs d. Resign from the position
Why can't private individuals always internalize an externality without the help of government?
a. Legal restrictions prevent side payments between individuals. b. Transactions costs may be too high. c. Side payments between individuals are inefficient. d. Side payments between individuals are insufficient.
What is the difference between the Consumer Price Index and the Producer Price Index?
How much did world trade total in 2011?
a. 16 trillion b. 18 trillion c. 20 trillion d. 22 trillion