Which of the following is correct?
A) AFC = TC/Q - TVC/Q
B) AVC = TVC - AFC
C) TC = AVC?Q
D) MC = TC - TVC
Answer: A
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Refer to Figure 11.4. Which diagram illustrates the effect of a decrease in government spending?
A) A B) B C) C D) D
For a monopolist that is maximizing profits
A) price exceeds marginal cost. B) price equals marginal revenue. C) price equals average total cost. D) marginal revenue exceeds price.
Graphically show how transfer payments affect labor supply and production possibilities.
What will be an ideal response?
Based on your understanding of your roommate's preferences, you predict that he will select the spaghetti for his lunch at the cafeteria, but instead he chooses the gyros. How do you describe this event in terms of economic theory?
A. Your roommate is irrational. B. You roommate does not know his own preferences as well as you do. C. You constructed a model that made a prediction, and the prediction was refuted. D. Your roommate does not know what is in his own best interests.