Which of the following statements best describes firms under monopolistic competition?
a. Profits will be positive in the long run.
b. Price always equals average variable cost.
c. In the long run, positive economic profit will be eliminated.
d. Marginal revenue equals minimum average total cost in the short run.
c
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The economy of Budopia is going through a recession. How will a countercyclical policy affect the labor market in Budopia if wages are flexible? Explain with a diagram
What will be an ideal response?
Is the EU an optimum currency area? Why or why not?
What will be an ideal response?
Other things equal, if the prices of a firm's variable inputs were to fall:
A. marginal cost, average variable cost, and average total cost would all fall. B. one could not predict how unit costs of production would be affected. C. marginal cost, average variable cost, and average fixed cost would all fall. D. average variable cost would fall, but marginal cost would be unchanged.
In the short run, the ATC curve and the AFC curve for information products are
A. downward sloping. B. horizontal. C. vertical. D. upward sloping.