For a perfectly competitive firm, in the short run, which of the following statements is true?
a. A price above minimum average variable cost, but below average total cost will produce an economic profit.
b. A price below minimum average variable cost will cause the firm to shut down.
c. Marginal cost is parallel to the axis showing quantity of output.
d. Price is always greater than marginal revenue.
e. Every firm contributes a significant amount to the total market output.
b
You might also like to view...
Assume an automobile manufacturer can sell its sport utility vehicle (SUV) with or without a trailer towing package. One group of customers, group A, is willing to pay a maximum of $30,000 for the SUV and $1,100 for the towing package
A second group, B, is willing to pay $29,000 for the SUV and $1,000 for the towing package. Assuming the manufacturer cannot price discriminate, to maximize its revenues the manufacturer should: A) sell the components separately, charging $30,000 for the SUV and $1,000 for the towing package. B) sell the components separately, charging $29,000 for the SUV and $1,100 for the towing package. C) sell the components separately, charging $29,000 for the SUV and $1,000 for the towing package. D) sell the components as a bundle for $30,500.
When foreigners export goods to the United States
a. they reduce the ability of the U.S. to export products abroad. b. they acquire the dollars that are necessary to purchase goods, services, and assets from Americans. c. they reduce the living standards of Americans. d. they cause the dollar to depreciate.
When deciding how much to save, people care most about
a. after-tax nominal interest rates. b. after-tax real interest rates. c. before-tax real interest rates. d. before-tax nominal interest rates.
The terms of trade refers to:
What will be an ideal response?