Suppose a monopolist's costs and revenues are as follows: ATC = $50; MC = $35; MR = $40; P = $55. The firm should
A. increase output and decrease price.
B. shut down.
C. not change output or price.
D. decrease output and increase price.
Answer: A
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If output is increased in the long-run, average production costs in the presence of internal economies of scale will ________, and in the presence of external economies of scale, will ________
A) decrease; decrease B) increase; remain constant C) remain constant; increase D) decrease; remain constant E) increase; decrease
Which of the following is true?
a. An increase in the interest rate will tend to increase stock prices. b. A reduction in the interest rate will tend to increase stock prices. c. An increase in the inflation rate will tend to increase stock prices. d. There is no reason to believe that changes in interest rates will influence stock prices.
Refer to the below graphs. The formation of an exclusive or craft union, with no change in demand, is depicted by situation:
A. A
B. B
C. C
D. D
Gooey Flakes is the only ready-to-eat cereal that has chocolate syrup injected into each flake. The machine that injects the syrup into the flakes can do nothing else. Which of the following is true?
a. All of the machine's earnings are economic rent. b. All of the machine's earnings are opportunity cost. c. The supply curve for this machine is horizontal. d. The demand curve for this machine is horizontal. e. The demand curve for this machine is vertical.