If a perfectly competitive firm is currently producing where P = MC and MC = ATC, then the firm will earn ________ profits.
A) positive
B) zero
C) negative
D) above normal
B) zero
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Refer to Figure 4-15. How much of the tax is paid by buyers?
A) $2 B) $5 C) $7 D) $12
In a price-fixing agreement amongst two oligopolists, each seller's best strategy would be to maintain the agreement, as it would leave both of them better off
Indicate whether the statement is true or false
If tariffs are decreased, the long-run effect is most likely to be
a. a decrease in both U.S. imports and exports. b. an increase in both U.S. imports and exports. c. a decrease in U.S. imports and an increase in U.S. exports. d. an increase in U.S. imports and a decrease in U.S. exports.
In the long-run, the price elasticity of demand is usually
a. smaller than in the short-run. b. bigger than in the short-run. c. the same as in the short run. d. equal to zero. e. can't tell from the information given.