Costs that do NOT vary with output are
A) total costs.
B) variable costs.
C) fixed costs.
D) marginal costs.
Answer: C
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Because consumers value product variety
A) society must be more efficient with monopolistic competition than with perfect competition. B) the inefficiency and deadweight loss created by monopolistic competition is offset. C) in the long run, monopolistically competitive firms earn an economic profit. D) monopolistically competitive industries are efficient.
If a monopolist's price is $50 per unit and its marginal cost is $25, then
A) to maximize profit the firm should continue to produce the output it is producing. B) to maximize profit the firm should decrease output. C) to maximize profit the firm should increase output. D) Not enough information is given to say what the firm should do to maximize profit.
In order to increase the supply of a good, producers must
A) convince consumers to reduce the quantity demanded. B) see an increase in quantity supplied by competitors. C) reduce their per-unit costs of producing the good. D) cut back on labor to reduce production costs.
A recession causes
a. transfer payments and corporate profits to increase b. military spending and corporate profits to increase c. unemployment to increase and transfer payments to decrease d. transfer payments to increase and corporate profits to decrease e. household income and government transfer payments to decrease