When the price of a perfectly competitive firm's output rises:
A. the firm will produce more.
B. the firm's marginal cost curve will shift to the left.
C. the firm's marginal cost curve will shift to the right.
D. the firm will produce less.
Answer: A
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Division of labor increases productivity because
a. tasks can be assigned according to individual tastes and abilities b. workers who repeatedly perform the same tasks become bored c. each worker must learn each of the numerous tasks in the total production process d. specialization of labor allows for the introduction of cheaper, less sophisticated production techniques e. managers can force workers to produce goods that are valued more highly than the costs of producing them.
Which of the following does the law of demand specifically imply?
a. If the product price increases, quantity demanded will decrease. b. If consumer income increases, quantity demanded will increase. c. If the product price increases, quantity demanded will increase. d. If consumer income increases, quantity demanded will decrease. e. If supply increases, demand will increase.
Which of the following could be the price elasticity of demand for a good for which a decrease in price would decrease revenue?
a. 0.8 b. 1 c. 1.8 d. 2.4
Bank A has checkable deposits of $900,000 and total reserves of $112,000. If the required reserve ratio is 8 percent, the bank has excess reserves of
A) $40,000. B) $72,000. C) $13,440. D) $4,000.