Table 10-1
Q (in units)
AFC (in dollars)
AVC (in dollars)
MC (in dollars)
0
C
C
C
2
2.5
18
10
4
1.25
14
14
6
0.83
18
42
8
0.63
30
94
10
0.5
50
170
In Table 10-1 the short-run cost schedules of a perfectly competitive firm are shown. Suppose that the market price of output is $20, the firm will produce ____ units and earn a profit of ____.
A. 6; $7.02
B. 6; $112,98
C. 8; $160
D. 4; $19
Answer: D
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If government expenditure on goods and services increases by $10 billion, then aggregate demand
A) increases by $10 billion. B) increases by $10 billion multiplied by the government expenditure multiplier. C) increases by $10 billion multiplied by the tax multiplier. D) decreases by $10 billion. E) decreases by $10 billion multiplied by the government expenditure multiplier.
Public goods are characterized by: a. rivalry in consumption
b. nonrivalry in consumption. c. excludability of nonpayers. d. none of the above
If Fifth Third Bank had actual reserves of $1 billion and required reserves of $1.1 billion, its excess reserves would be
A. $1 billion. B. $100 million. C. 0. D. -$100 million.
In the AS/AD model, in the short run, monetary policy affects:
A. only inflation. B. both inflation and real output. C. only real output. D. neither inflation nor real output.