In the long run the prices charged by a firm in a competitive price-searcher market will be
a. high enough to provide profits to the firm.
b. so low that many firms will drop out of the industry.
c. equal to marginal cost.
d. equal to average cost, including the opportunity cost of capital.
D
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Personal consumption expenditures include all of the following EXCEPT spending on
A) consumer durable goods. B) consumer nondurable goods. C) consumer services. D) new housing.
Assume Congress enacts a $10 billion increase in spending and a $10 billion tax increase to finance the additional government spending. The result of this balanced-budget approach is a:
a. $20 billion increase in aggregate demand. b. $10 billion increase in aggregate demand. c. $100 billion increase in aggregate demand. d. $10 billion decrease in aggregate demand.
The table below shows a competitive firm's short-run production function. Labor is the firm's only variable input, and market price for the firm's product is $2 per unit.
If the wage rate is $200, how many units of labor will the firm employ?
A. 3 B. 4 C. 5 D. 6 E. 0, the firm shuts down
The rule of 72 says that at 6% interest $100 should become $200 in about:
A. 7.2 years B. 100 months C. 12 years D. 72 months