If the price of a product increases:
A. Consumer surplus will decrease
B. Consumer surplus will increase
C. Total revenue will definitely increase
D. Total revenue will definitely decrease
A. Consumer surplus will decrease
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If a firm is maximizing its profit and producing less than the output at which its average total cost is minimized, then that firm
A) must be suffering an economic loss. B) must be earning an economic profit. C) has excess capacity. D) is producing at its capacity output. E) must be earning a normal profit.
In the text, when the Nick Rudd Ice Company starts as a monopoly and then finally faces competition from a new entering ice company, its
a. price falls, its economic profit falls, but its output increases b. price falls, its economic profit falls, and its ATC falls c. price falls, its economic profit falls, and it faces a more elastic demand curve d. price increases, its economic profit falls, and it faces a less elastic demand curve e. ATC falls, its economic profit falls, and it faces a less elastic demand curve
If the demand for a product remains the same and the supply falls,
A. both the market clearing price and the equilibrium quantity will rise. B. the market clearing price will rise and the equilibrium quantity will fall. C. both the market clearing price and the equilibrium quantity will fall. D. the market clearing price will fall and the equilibrium quantity will rise.
The longer is the interval between firms' price adjustments
A. the smaller the output effect of a given change in the money supply. B. the shorter the interval the horizontal new Keynesian aggregate supply curve will remain in position. C. the longer the interval that the horizontal new Keynesian aggregate supply curve will remain in position. D. the new Keynesian aggregate supply curve will become steeper.