If a firm decides to produce no output in the short run, its costs will be:
A. its fixed plus its variable costs.
B. its fixed costs.
C. its marginal costs.
D. zero.
Answer: B
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Positive economics is descriptive because:
A) it is based on ethical judgments. B) its predictions cannot be verified with data. C) it prescribes what an individual or society ought to do. D) it explains what has happened or predicts what will happen.
Refer to Figure 13-7. Which of the following is the area that represents the profit or loss experienced by the firm?
A) a loss represented by the rectangle P2uvP1 B) a loss represented by the rectangle P2uwP0 C) an accounting profit equal to P1vwP0 D) a loss represented by the rectangle P1vwP0
Monetarism resembles Keynesian thinking in that they both
a. emphasize supply and ignore demand. b. integrate supply-side analysis into their models. c. emphasize demand side effects. d. emphasize the importance of fiscal policy.
Recall the Application about the decrease in price of illegal drugs in the United States to answer the following question(s).Recall the Application. If the decrease in price of illegal drugs is primarily due to a change in demand, the equilibrium quantity of drugs:
A. will increase. B. will decrease. C. will not change. D. may or may not change.