A perfectly competitive firm faces a market clearing price of $150 per unit. Average total costs are at the minimum value of $200 per unit at an output rate of 100 units. Average variable costs are at the minimum value of $100 per unit at an output rate of 50 units. Marginal cost equals $150 per unit at an output rate of 75 units. It can be concluded that the short-run profit-maximizing output rate is
A. 75 units, at which the firm earns positive economic profits per unit sold.
B. 50 units, because price is less than average variable costs.
C. 75 units, at which the firm earns zero economic profits per unit sold.
D. 75 units, at which the firm earns negative economic profits per unit sold.
Answer: D
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Which of the following statements is true regarding the differences between economic and accounting costs?
A) Accounting costs include all implicit and explicit costs. B) Economic costs include implied costs only. C) Accountants consider only implicit costs when calculating costs. D) Accounting costs include only explicit costs.
The distribution of income in developed countries is less egalitarian than less developed countries
a. True b. False Indicate whether the statement is true or false
The Sherman Antitrust Act of 1890 was passed primarily because of:
A. multiple examples of false and misleading advertising. B. the practices of various trusts in the railroad, steel, tobacco, and oil industries. C. the monopoly abuses committed by ALCOA. D. the popularity and political influence of John D. Rockefeller.
In a purely competitive market at its long-run equilibrium, which of the following is not true?
A) Price equals marginal cost, and they are equal to the lowest attainable average cost of production. B) The marginal benefit of the last unit of the product equals the marginal cost of producing that unit. C) The maximum willingness of buyers to pay for the last unit of the product equals the minimum acceptable price for the seller of that unit. D) The combined amount of consumer and producer surpluses is at its minimum possible.