Figure 6.1 shows the cost structure of a firm in a perfectly competitive market. If the firm's fixed cost increases by 3,000 due to a new government regulation:
A. the marginal cost curve shifts upward.
B. the average variable cost curve shifts upward.
C. the average total cost curve shifts upward.
D. None of these
Answer: C
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A) declares a stock split. B) declares bankruptcy. C) does not immediately stop operating. D) stops operating until sunk costs are recovered.
A normative economic statement can be proven either true or false
a. True b. False Indicate whether the statement is true or false
Money and income are used interchangeably by noneconomists but mean different things
a. True b. False Indicate whether the statement is true or false
Cartels are difficult to operate for which of the following reasons?
a) The work only if members keep to their agreed output b) they are illegal worldwide c) Firms in a cartel are likely to lose money d) The products are perfectly competitive