Under perfect competition, the individual firm's quantity is 
Figure 42.2
A. Q1.
B. Q2.
C. Qa.
D. Qb.
Answer: B
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The above figure represents the demand and marginal revenue curves for Sue's Seafood, a seller of fresh fish
a. Over what range of output is demand elastic? b. Over what range of output is demand inelastic? c. What price maximizes total revenue? d. What is the price elasticity of demand at the revenue maximizing price?
Suppose our firm produces chartered business flights with capital (planes) and labor (pilots) in fixed proportion (i.e., one pilot for each plane)
If the wage rate paid to the pilots increases relative to the rental rate of capital for the airplanes, then: A) the optimal capital-labor ratio should increase. B) the optimal capital-labor ratio should decrease. C) the optimal capital-labor ratio remains the same. D) We do not have enough information to answer this question.
If fast food is an inferior good then:
A. the quantity of fast food demanded will rise as the price of fast food rises. B. the demand for fast food will fall as income falls. C. the demand for fast food will fall as income rises. D. the demand for fast food will fall as the price of fast food rises.
For a firm in a perfectly competitive industry, price equals marginal revenue.
Answer the following statement true (T) or false (F)