Refer to Figure 8.2. If the firm expects $80 to be the long-run price, how many units of output will it plan to produce in the long run?
A) 22
B) 34
C) 38
D) 50
E) 64
E
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Assuming all else equal, if households are pessimistic about their future income, it is likely to cause a(n):
A) upward movement along their credit demand curve. B) rightward shift of their credit demand curve. C) downward movement along their credit demand curve. D) leftward shift of their credit demand curve.
If asset A is significantly more liquid than asset B, then it is _____ costly to convert asset A into cash than it is to convert asset B into cash. Furthermore, it is likely that asset B will be included in the _____ measure of money.
A. more; M1 B. less; M1 C. less; M2 D. more; M2
If the marginal propensity to save is 0.4 and disposable income increases from $1,000 to $2,000, saving will increase
A. $400. B. $200. C. $300. D. $100.
If the opportunity costs of producing a good increase as more of that good is produced, the economy's production possibility frontier will be
A. a negatively sloped straight line. B. negatively sloped and "bowed inward" toward the origin. C. negatively sloped and "bowed outward" from the origin. D. a positively sloped straight line.