Which of the following is the set of conditions necessary for long-run equilibrium for a perfectly competitive firm?
A. P = SRMC = SRAC = LRAC
B. P = SRMC = SRAC > LRAC
C. P = SRMC < SRAC = LRAC
D. P > SRMC = SRAC = LRAC
Answer: A
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Answer the following statement(s) true (T) or false (F)
1. A non-congested toll road is an example of a good that is excludable, but not rivalrous in consumption. 2. Public goods can frequently be provided by private action when the resulting benefits are widespread. 3. All economists agree that a public good is one the is nonrivalrous and nonexcludable. 4. When a public goods increases the desirability of living in a certain area, benefits tend to be captured entirely by an increase in land values. 5. In a Clarke tax scheme, the amount of tax that a person pays depends, in part, on his revealed preference for the public good.
If we graph marginal utility, the curve has a negative slope. This is because of the
A. optimal purchase rule. B. law of increasing costs. C. law of diminishing marginal utility. D. marginal rate of substitution.
A variable that tends to move later than aggregate economic activity is called
A) a leading variable. B) a coincident variable. C) a lagging variable. D) an acyclical variable.
The theorem that suggests that politicians maximize their votes by taking the policy position preferred by the median voter, under certain conditions is called the:
A. average voter theorem. B. mid-voter theorem. C. median-voter theorem. D. moderate vote theorem.