A firm should never produce any output if
A) P < AVC.
B) P < ATC.
C) AR < ATC.
D) MR < MC.
Answer: A
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In Taylor Rule equation, high value of parameter b indicates that
A) Fed cares more about avoiding recessions and high unemployment than about avoiding inflation. B) Fed cares more about avoiding inflation than about avoiding recessions and high unemployment. C) Fed cares more about avoiding recessions than about avoiding high unemployment. D) Fed cares more about avoiding high unemployment than about avoiding recessions.
An example of in-kind income is: a. a welfare payment
b. a cash grant. c. a housing subsidy. d. an unemployment check.
If marginal cost is zero a firm can still profit through pricing
Indicate whether the statement is true or false
Given a fixed nominal interest rate on a loan, unanticipated inflation:
a. decreases the burden of paying off the loan. b. increases the burden of paying off the loan. c. does not alter the burden of paying off the loan. d. benefits savers.