Suppose that at a firm's profit-maximizing level of output, its total revenue is $1,250, the total cost of its variable factors of production is $1,000, and its total fixed cost is $500. This firm will ________ in the short run, and will ________ in the long run.
A. shut down; reopen for business
B. earn a loss; earn a profit
C. not shut down; exit the industry
D. earn a profit; earn a loss
Answer: C
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An alternative approach is to raise taxes on gasoline and other fuels. What is the economic intuition of this policy?
To promote cleaner air, the federal government in the United States enacted tax incentives for purchasing new electric vehicles or clean-fuel vehicles. These were scheduled to be phased out over time.
For legal purposes, a corporation is treated as
A. an individual. B. a nonprofit organization. C. a partnership. D. a limited partner in a partnership.
In Exhibit 3, what area(s) represent consumer surplus gains from imports after free trade is allowed?
a. a
b. b
c. a and b
d. b and d
When a person can pass some of her costs of using a resource on to someone else,
A. she uses too much of the resource. B. the use of the resource is not affected by her actions. C. the internal costs of using the resource exceed the private costs. D. she uses too little of the resource.