For perfectly competitive firms, marginal revenue always equals price.
Answer the following statement true (T) or false (F)
True
Because a competitive firm can sell all its output at the prevailing price, the marginal revenue will always be equal to price and the MR curve.
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In the above figure, point B
A) is superior to point A. B) is inferior to point A. C) is as good as point A. D) could be superior to, inferior to, or as good as point A but there is no way of telling which.
Ricardo likes to rent DVDs and attend concerts. The DVDs cost $4 and the concerts cost $40. Ricardo's marginal utility from the last DVD is 20 units. Ricardo is maximizing his utility. What is his marginal utility from the last concert he attended?
What will be an ideal response?
Easy money policy is _____.
(A) Monetary policy that increases the money supply. (B) Monetary policy that reduces the money supply. (C) The belief that the money supply is the most important factor in macroeconomic performance. (D) The time it takes for monetary policy to have an effect.
Contrast the sticky wage theory with the sticky price (menu cost) theory in a situation where the overall price level increases.
a. Under the sticky wage theory, producers expand production and sales because of higher profit margins, whereas under the sticky price theory, producers find their sales increasing because their prices are relatively lower. b. Under the sticky wage theory, producers find their sales increasing because their prices are relatively lower, whereas under the sticky price theory, producers expand production and sales because of lower profit margins. c. Under the sticky wage theory, producers reduce production and sales because of higher profit margins, whereas under the sticky price theory, producers find their sales decreasing because their prices are relatively lower. d. Under the sticky wage theory, producers find their sales decreasing because their prices are relatively lower, whereas under the sticky price theory, producers decrease production and sales because of higher profit margins.