Suppose that once a well is dug, water flows out of it continuously without any additional effort. Customers collect their water and pay a per gallon fee when they leave the site of the well. In the short run, the competitive firm in this market
A) will not shut down because variable costs are zero.
B) has no fixed costs.
C) faces diminishing marginal returns.
D) can act as a price setter.
A
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Allocative efficiency occurs in markets when
a. marginal benefit and marginal cost for the last unit sold are equal b. resources can be reallocated to increase the value of total output c. goods are produced at the minimum of average total cost d. goods are distributed evenly among consumers e. government establishes price ceilings below the market price
One of the major impacts of restricting immigration is that the:
a. prices of the products produced by unskilled laborers will decline. b. prices of the products produced by unskilled labor will increase. c. supply of labor in agriculture will increase. d. supply of labor in the industrial sector will rise. e. government's expenditure on education and health will rise.
Simple majority rule will almost always generate efficient outcomes
Indicate whether the statement is true or false
Within the aggregate demand/aggregate supply framework, the quantity produced and purchased in the goods and services market represents
What will be an ideal response?