Why does a firm in a competitive industry charge the market price?
a. If a firm charges less than the market price, it loses potential revenue.
b. If a firm charges more than the market price, it loses all its customers to other firms.
c. The firm can sell as many units of output as it wants to at the market price.
d. All of the above are correct.
d
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According to the above figure, the profit maximizing price-output combination for the monopolist is a price of
A) 50 cents and an output of 40,000 newspapers per day. B) 30 cents and an output of 30,000 newspapers per day. C) 60 cents and an output of 30,000 newspapers per day. D) 45 cents and an output of 45,000 newspapers per day.
In the definition of GDP, the words "total market value" refer to total
A) dollar value at base prices. B) dollar value at current prices. C) subjective value. D) objective value. E) a and d
The socially optimal provision of a public good can be obtained by
a. Privatizing the good b. Vertically adding the demand curves for the good c. Horizontally adding the demand curves for the good d. Eliminating access to the good e. Allowing open access to the good
A movement along the consumption function is the result of changes in
a) the real interest rate b) disposable income c) expected future income d) the price level