Fixed costs for a firm are analogous to:
A. the dirt that fills up the financial hole.
B. digging a deeper financial hole by producing when prices are too low.
C. the cost of the shovel needed to fill the financial hole.
D. starting out in a hole that represents economic losses if the firm produces nothing.
Answer: D
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Compared to perfect competition, the consumer surplus in a monopoly
A) is lower because price is higher and output is lower. B) is unchanged because price and output are the same. C) is eliminated. D) is higher because price is higher and output is the same.
The short-run aggregate supply curve is horizontal when
A) prices are inflexible and the economy is at full employment. B) there are unemployed resources and prices do not increase when aggregate demand increases. C) there are unemployed resources and prices do not decrease when aggregate supply increases. D) there are no unemployed resources and prices do not increase when aggregate demand or supply increases.
If everyone earned the same income, the Lorenz curve would be
A) a rectangular hyperbola. B) a straight line from the origin at a 45-degree angle. C) the horizontal axis. D) very bowed from the diagonal.
Microsoft's government-granted exclusive right to make and sell the Windows operating system is called a