Refer to the information provided in Figure 15.5 below to answer the question(s) that follow. 
Figure 15.5 Refer to Figure 15.5. Assume The Custom Sweater Shop has fixed costs of $500 and is a monopolistically competitive firm. If the firm produces the profit-maximizing level of output and sells it at the profit-maximizing price, the firm ________ of $400.
A. earns a profit
B. suffers a loss
C. has total cost
D. has total revenue
Answer: B
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The quantity demanded of a good reflects
A) the number of units of a good people actually purchase. B) the number of units of a good suppliers will provide. C) the number of units of a good people plan to purchase at different prices. D) the number of units of a good people need to purchase.
In which of the following situations would a person be best off in real terms?
a. Receiving a 10 percent increase in a nominal wage, with an 8 percent rate of inflation in the economy b. Receiving a 3 percent increase in a nominal wage, with a 0 percent rate of inflation in the economy c. Receiving a 4 percent increase in a nominal wage, with a 5 percent rate of inflation in the economy d. Receiving no increase in a nominal wage, with a 5 percent rate of deflation in the economy e. Receiving a 2 percent decrease in a nominal wage, with a 6 percent rate of deflation in the economy
Net exports is calculated by subtracting what from exports?
a. aggregate expenditure b. government purchases c. imports d. inventories
With an increase in government purchases financed by an increase in the marginal tax rate on labor income, the change in labor supply depends on whether the:
a. negative substitution effect is bigger than the positive income effect. b. positive substitution effect is bigger than the negative income effect. c. negative substitution effect is bigger than the negative income effect. d. positive substitution effect is bigger than the positive income effect.