In the above figure, the intersection of curves A and C is the point at which
A) average total cost is minimized.
B) average variable cost is minimized.
C) average fixed cost is minimized.
D) total product is maximized.
B
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A perfectly competitive firm is producing at the point where its marginal cost equals its marginal revenue. If the firm boosts its output, its total revenue will ________ and its profit will ________
A) rise; rise B) rise; fall C) fall; rise D) fall; fall
Which of the following applies to the tragedy of the commons? I. In the absence of government action, there is an absence of incentives to prevent the overuse of the common resource. II
When consumers take account of the marginal social benefit and marginal social cost, overuse of the resource occurs. III. Even with government action, it is impossible for an efficient level of output to be achieved. A) I only B) I and II C) II and III D) I, II and III
A government spending multiplier of 1.5 would imply that a $1 trillion stimulus package would be expected to generate
A) $0.15 trillion in GDP B) $1.5 trillion in GDP C) $3 trillion in GDP D) $15 trillion in GDP
If gas prices today were $2.50 per gallon, in terms of history, this would be
A. not an all-time high but rather high in inflation-adjusted terms. B. an all-time high in nominal terms. C. about the long-term historical average in inflation-adjusted terms. D. an all-time high in inflation-adjusted terms.