The marginal cost curve of a firm above AVC is also its short-run supply curve.
Answer the following statement true (T) or false (F)
True
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Assume the auto market is initially in equilibrium with imports from Japan taking up a significant share of the market. Now assume a quota on imports of Japanese cars is established
What will occur at the initial equilibrium price to signal market participants regarding the change that has taken place? A) A surplus is created by an increase in supply. B) A surplus is created by a decrease in demand. C) A shortage is created by an increase in demand. D) A shortage is created by a decrease in supply.
Economists are concerned with ______ behavior.
a. industrial b. human c. chemical d. government
Assuming prices and wages are fully flexible, the aggregate supply curve will be:
A. upward sloping, but not vertical. B. vertical. C. horizontal. D. downward sloping.
The threat of punishment in a repeated game tends to:
A. reduce the incentive to break a pricing agreement. B. anger the other firms, resulting in a price war. C. maintain prices at the duopoly price level. D. deter entry.