If a firm that has variable costs of $8 million shuts down, we may conclude that its total revenue is __________.
Fill in the blank(s) with the appropriate word(s).
less than $8 million
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Four stores have a problem with theft and security is a public good. Let S stand for the number of person-hours of security patrols per week. The marginal benefit of security patrols to each of the stores is given by the formula MB = 200 - 2S. Patrols cost $20 per hour. If each store provided security independently, how much would each store provide?
A. 90 person-hours of patrols per week B. 100 person-hours of patrols per week C. 92.5 person-hours of patrols per week D. 97.5 person-hours of patrols per week
An increase in the real interest rate will
A) most likely lower the reward to savings. B) most likely lower the cost of borrowing. C) most likely lower consumers' purchases of durable goods. D) cause consumers to spend more and save less.
When firms are said to be price takers, it implies that if a firm raises its price,
a. buyers will go elsewhere. b. buyers will pay the higher price in the short run. c. competitors will also raise their prices. d. firms in the industry will exercise market power.
It is easier to sustain tacit collusion in an infinitely repeated game if:
A. the present value of cheating is lower than collusion and the interest rate is higher. B. there are many players. C. the present value of cheating is lower than collusion. D. the interest rate is higher.