In the short run, firms expand their production when the price level rises because
A) the money wage rate remains constant so the higher prices for their products makes it profitable for firms to expand production.
B) each firm must keep its production up to the level of its rivals, and some firms will expand production as the price level increases.
C) the higher prices allow the firm to hire more workers by offering higher wages, thereby increasing productivity and profits.
D) firms can increase their profits by increasing their maintenance.
A
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Which of the following best defines "economies of scope"?
A) As output expands the cost of producing a good decreases. B) As output expands the cost of producing a unit of a good decreases. C) Because firms use specialized resources to produce a range of goods, as the number of products produced increases, the cost of producing a unit decreases. D) Costs increase as firms seek to find more consumers.
The monopoly maximizes profit by setting
A) price equal to marginal cost. B) price equal to marginal revenue. C) marginal revenue equal to marginal cost. D) marginal revenue equal to zero.
If government spending is used to bolster the level of economic activity, the type of financing available to the U.S. government that would increase aggregate spending the most is
a. taxation. b. borrowing from the public. c. borrowing from banks. d. printing money.
Experience rating systems for pricing insurance encourage firms to discriminate against older and disabled workers in their hiring practices.
Answer the following statement true (T) or false (F)