Suppose that Megabucks Corporation is earning an economic profit of $4,000 through the sale of a product. If the price of the product is $6 per unit and its ATC is $4 per unit, Megabucks must be producing 8,000 units
a. True
b. False
Indicate whether the statement is true or false
False
You might also like to view...
Transaction costs are the costs incurred by individuals dealing with one another. ?
Answer the following statement true (T) or false (F)
In an M-form organization
a. The number of divisional conflicts are reduced b. Decision making speed increases c. Customer retention tends to increase d. All of the above
Large denomination time deposits are the difference between ________ and ________.
Fill in the blank(s) with the appropriate word(s).
A constant-cost, perfectly competitive market is in long-run equilibrium. At present, there are 1,000 firms each producing 400 units of output. The price of the good is $60. Now suppose there is a sudden increase in demand for the industry's product
which causes the price of the good to rise to $64. In the new long-run equilibrium, how will the average total cost of producing the good compare to what it was before the price of the good rose? A) The average total cost will be higher than it was before the price increase since the increase in demand will drive up input prices. B) The average total cost will be lower than it was before the price increase because of economies of scale. C) The average total cost will be higher than it was before the price increase because of diseconomies of scale arising from the increased demand. D) The average total cost will be the lower than it was before the price increase as output increases.