If you have already signed up for a plan with your cell phone company that gives you 4,000 free minutes for $39.99 per month with a cost of $0.35 per minute for any time exceeding the limit, your marginal cost curve is:
A. horizontal at a marginal cost of zero up to 4,000 minutes.
B. horizontal at a marginal cost of zero.
C. upward-sloping.
D. horizontal at a marginal cost of $0.35.
Answer: A
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Consider the market for nonalcoholic beers from the previous question. Boors' price in a Nash equilibrium (assuming Bertrand competition in these differentiated beers) is about
a. 1.71 b. 2.55 c. 3.55 d. 4.29
Can macroeconomic policy be used systematically to create unanticipated inflation?
A. Yes, according to classical economists. B. No, according to Keynesian economists. C. Yes, according to Keynesian economists. D. Yes, according to classical economists, if Ricardian equivalence holds.
Answer the following statements true (T) or false (F)
1. Creative destruction is something that our society should try to avoid, through government regulation of business. 2. Creative destruction entails both costs as well as benefits. 3. The costs of competition's creative destruction are often widespread, while the benefits often accrue to only a few. 4. Some economists are now proposing that patents may be detrimental to technological advance in industries with complicated multiple-component products.
Why do accountants and economists calculate a firm's cost and profit in different ways?
What will be an ideal response?