Refer to the graph shown. If market price increases from $5.00 per unit to $6.00 per unit, a profit-maximizing perfectly competitive firm will:
A. decrease output from 750 to 650.
B. produce 850 units of output.
C. increase output from 650 to 750.
D. continue to produce 650 units.
Answer: C
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If the inflation rate is 5 percent and the real interest rate is 2.5 percent, then the nominal interest rate is
A) 10 percent. B) -2.5 percent. C) 2.5 percent. D) 7.5 percent. E) 2 percent.
Comment on the following statement: "The market demand for public goods is derived in the same way that the market demand for private goods is derived."
What will be an ideal response?
In an open economy, an increase in net exports because of increased demand for domestic products by foreigners should cause the domestic real interest rate to ________ and should cause desired saving minus desired investment to ________
A) rise; rise B) rise; fall C) fall; rise D) fall; fall
The price elasticity of gasoline supply in the U.S. is 0.4. If the price of gasoline rises by 8%, what is the expected change in the quantity of gasoline supplied in the U.S.?
A. +32.0% B. +0.32% C.-3.2% D. +3.2%