A firm in a perfectly competitive industry will maximize profits by adjusting
A) average total cost until it equals price.
B) price until marginal revenue equals marginal cost.
C) output until average revenue equals short-run average total cost.
D) output until marginal cost equals marginal revenue.
E) price until average revenue equals average total cost.
Ans: D) output until marginal cost equals marginal revenue.
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If barbers in Mexico are just a productive as their counterparts in the United States then why do they earn lower wages?
What will be an ideal response?
The chairman of the Federal Reserve Board of Governors:
A. Is elected by U.S. voters. B. Will typically change following each presidential election. C. Serves a four-year term and can be reappointed. D. Is always closely tied to the same political party as the president.
To the extent that the value of money is less predictable, it becomes
A. more acceptable as a store of value. B. more acceptable as a unit of account. C. more acceptable as a standard of deferred payment. D. less acceptable as a medium of exchange.
Changes in government purchases affect planned spending:
A. directly, by changing autonomous expenditures. B. autonomously. C. indirectly, by changing induced expenditures. D. only when there is an expansionary gap.