Suppose a monopolist charges a price corresponding to the intersection of the marginal cost and marginal revenue curves. If this price is between its average variable cost and average total cost curves, the firm will:
a. earn an economic profit.
b. stay in operation in the short-run, but shut down in the long run if demand remains the same.
c. shut down.
d. none of these.
b
You might also like to view...
The Glass-Steagall Act was designed to
A) legally separate investment banking from commercial banking. B) promote mergers in the banking industry. C) impose high capital ratios on investment banks. D) promote the interests of community banks.
For each of the following scenarios, state the short-run effect on the AD curve
a. The price level decreases. b. The target inflation rate increases. c. The U.S. dollar falls in value relative to other currencies. d. Government spending increases. e. The Fed becomes more tolerant of deviations from the target inflation rate.
Today the great divide between the haves and have-nots is a _______________.
Fill in the blank(s) with the appropriate word(s).
Japan did not lead the world in automobile production in the 1950s because _________________________.
Fill in the blank(s) with the appropriate word(s).