In the figure above, what is Gap's economic profit?
A) zero
B) $5,000
C) -$5,000
D) -$1,160
A
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In 1999, both the equilibrium price and equilibrium quantity of widgets increased. Use supply and demand analysis to explain how these changes could have occurred
What will be an ideal response?
When the price level falls
a. people want to hold less money. b. the interest rate falls. c. investment spending rises. d. All of the above are correct.
If consumers respond to a 10% price reduction by buying twice as much of a particular good, we would conclude that:
A. the price elasticity of demand at the original price was less than one. B. the price elasticity of demand at the original price was greater than one. C. there was excess demand at the original price. D. there was excess supply at the original price.
Economies and diseconomies of scale explain:
A. the profit-maximizing level of production. B. why the firm's long-run average total cost curve is U-shaped. C. why the firm's short-run marginal cost curve cuts the short-run average variable cost curve at its minimum point. D. the distinction between fixed and variable costs.