Refer to the information provided in Figure 1.7 below to answer the question(s) that follow.
Figure 1.7Refer to Figure 1.7. The slope of the line between Points A and B is
A. 1.5.
B. 0.67.
C. -0.67.
D. -1.5.
Answer: B
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In a perfectly competitive market, when the price is below the minimum average total cost for all firms:
A. accounting profits will be positive. B. firms will likely enter the market. C. the price will eventually rise once enough firms have left the market. D. economic profits will be equal to zero.
In the context of aggregate supply, the long run is defined as the period during which
a. some prices are set by contracts and cannot be adjusted. b. prices can change, but neither aggregate supply nor aggregate demand can shift. c. individuals have sufficient time to modify their behavior in response to price changes. d. quantity changes cannot occur in response to changes in relative prices.
Bob's Butcher Shop is the only place within 100 miles that sells bison burgers. Assuming that Bob is maximizing his profit, which of the following statements is true?
a. The price of Bob's bison burgers will be less than Bob's marginal cost. b. The price of Bob's bison burgers will exceed Bob's marginal cost. c. The price of Bob's bison burgers will equal Bob's marginal cost. d. Costs are irrelevant to Bob because he is a monopolist.
Games that don't have a dominant strategy:
A. don't exist; all games have at least one dominant strategy. B. may have stable equilibrium outcomes. C. always have stable equilibrium outcomes. D. do not have stable equilibrium outcomes.