The Lawn Ranger, a landscaping company, has total costs of $5,000 and total variable costs of $1,000. The Lawn Ranger's total fixed costs are
A. $0.
B. $4,000.
C. $6,000.
D. indeterminate because the firm's output level is unknown.
Answer: B
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An example of a Pigovian tax would be a tax on:
A. income. B. cigarettes. C. corporate capital gains. D. All of these are examples.
The monopoly that does not practice price discrimination
a. is a firm with a marginal revenue curve with a slope of zero b. is a price taker c. charges the same price for every unit of output it sells d. operates in a market where all firms charge the same price e. is always profitable in the short run
If the price of inputs falls and the level of consumer indebtedness rises:
a. Price index falls, and the change in real GDP is uncertain. b. The change in price index is uncertain, and real GDP rises. c. Price index rises, and the change in real GDP is uncertain. d. Price index falls, and real GDP rises. e. Price index falls, and real GDP falls.
Suppose a perfectly competitive firm can increase its profits by increasing its output. Then it must be true that the firm's:
A. marginal revenue is less than its marginal cost. B. marginal cost exceeds its marginal revenue. C. price exceeds its marginal cost. D. price exceeds its marginal revenue.