The authors explain that a firm earning a zero economic profit in the long run has earned a competitive return on their investment. What do they mean by "competitive" return in this context?
A) The firm's return could only be earned under perfect competition and would be smaller under imperfect competition.
B) The firm's return is at least as larger as the returns earned by other firms.
C) The firm's return is at least as larger as could be earned in another investment.
D) The firm's return is negative, which initiates stronger competition among firms in the market.
C
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Under a cost plus fixed fee contract the contractor cannot make a loss
a. True b. False
Which of the following would cause prices to fall and output to rise in the short run?
a. Short-run aggregate supply shifts right. b. Short-run aggregate supply shifts left. c. Aggregate demand shifts right. d. Aggregate demand shifts left.
If inflation increases, one would expect that the Fed would:
A. reintroduce unconventional policy. B. wind down unconventional policy more slowly. C. change unconventional policy to conventional policy. D. wind down unconventional policy more quickly.
Refer to the table shown to answer the question. Between $2 and $2.20, demand is:PriceQuantity Demanded$1.60130$1.80120$2.00110$2.20100$2.4090$2.6080
A. elastic. B. inelastic. C. unit elastic. D. perfectly elastic.