A local cable company has its rates set at P = $15 by a regulatory commission. Its current output is 10,000 households and its costs are as follows: ATC = $17; AVC = $14; and MC = $15 . From this, we can tell that this is:
a. a fair price, and the firm earns a normal profit.
b. a fair price, and the firm earns an economic loss.
c. marginal cost pricing, and the firm earns a normal profit.
d. marginal cost pricing, and the firm earns an economic loss.
e. the same price that an unregulated monopolist would charge.
d
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The optimal level of resource use comes when
A. MRP exceeds input price. B. MRP is less than input price. C. MRP equals input price. D. use of the resource exhausts the producer’s funds.
All of the following are considered to be unemployed EXCEPT
A) job leavers. B) discouraged workers. C) job reentrants. D) new job entrants.
The first banking crisis of the 1930s was probably caused by
a. low farm prices. b. the stock market crash. c. antagonism between Wall Street banks and Main Street banks. d. Bank of England attempts to preserve the gold standard by raising interest rates.
Capital
A. comes from savings. B. can be built up by holding down consumption. C. is one of four economic resources. D. All of the choices are true about capital.