Consider an industry with two firms producing similar products. Each firm's total cost (in dollars) is given below.Acme Manufacturing: TC = 100 + 3Q Generic Industries: TC = 500 + 3Q When each firm is producing the same quantity, Acme's average total cost is:
A. lower than Generic's average total cost at some levels of output, and higher than Generic's average total cost at other levels of output.
B. lower than Generic's average total cost.
C. equal to Generic's average total cost.
D. higher than Generic's average total cost.
Answer: B
You might also like to view...
What is the antithesis of the rule of law?
A) Arbitrary governance B) Governance according to the will of whoever is in charge C) Both of the above. D) None of the above.
The narrowest definition of the money supply is
A) M1. B) M2. C) the difference between M2 and M1. D) the sum of M1 and M2.
Consider a Stackelberg duopoly with the following inverse demand function: P = 100 ? 2Q1 ? 2Q2. The firms' marginal costs are identical and are given by MCi(Qi) = 2. Based on this information, the leader's reaction function is:
A. r1(Q2) = 24.5 ? 0.5Q2 and r1(Q2) = 24.5 ? 0.5Q1. B. Q1 = 49 ? 0.5Q2 and Q2 = 49 ? 0.5Q1. C. The Stackelberg leader does not react to the output decision of its rival. D. r1(Q2) = 24.5 ? 0.5Q1 and r2(Q1) = 24.5 ? 0.5Q2.
To measure the growth of the average standard of living over time, we
A. measure and compare inflation rates. B. look at the growth in human capital. C. look at the aggregate production function. D. look at the change in real GDP per capita.