If the price of a firm's product is $12 and the firm faces a constant marginal cost of $5 that is equal to its (constant) average total cost, the profit from selling a unit of the firm's product from its inventory is equal to ________.
A) $5 B) $7 C) $8 D) $15
B) $7
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Diversification:
A. increases the likelihood that bad things will happen. B. means you're not likely going to be completely ruined by a single unfortunate event. C. reduces the likelihood that bad things will happen. D. None of these statements is true.
A monopolist that chooses price
A) necessarily produces less than a monopolist that chooses quantity, hence the laws against price fixing. B) produces the same amount as a monopolist that chooses quantity. C) produces more than a monopolist that chooses quantity, thus the irony of laws against price fixing. D) could produce more or less than a monopolist that chooses quantity since the demand curve is not specified.
Some oligopolies may try to maximize sales revenue rather than maximize profits
a. True b. False Indicate whether the statement is true or false
In a perfectly competitive market, the process of entry and exit will end when firms face
a. marginal revenue equal to long-run average total cost. b. total revenue equal to average total cost. c. average revenue greater than marginal cost. d. accounting profits equal to zero.