Refer to the graph shown. If market price is currently $7.00 per unit, this perfectly competitive firm will maximize profit by producing:
A. between 550 and 650 units of output.
B. 850 units of output.
C. 650 units of output.
D. 450 units of output.
Answer: B
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A) marginal benefit; total cost B) marginal cost; total benefit C) opportunity cost; total benefit D) net benefit; both cost and benefit
Which of the following best describes circumstances surrounding the breakdown of the Bretton Woods system?
a. The United States was enjoying a persistent trade surplus. b. There was too much dependence on the dollar because no other country had a stable currency. c. Germany, with its strong currency, refused to defend the dollar. d. Speculators were betting on the fall of the dollar. e. All the other nations basically wished their currencies to appreciate, which was impossible under the system.
When the elasticity of demand for a particular good is between zero and -1, _____
a. demand is elastic b. demand is inelastic c. demand is unit-elastic d. the good is an inferior good e. the good is a normal good
In the text, when the Nick Rudd Ice Company starts as a monopoly and then finally faces competition from a new entering ice company, its
a. price falls, its economic profit falls, but its output increases b. price falls, its economic profit falls, and its ATC falls c. price falls, its economic profit falls, and it faces a more elastic demand curve d. price increases, its economic profit falls, and it faces a less elastic demand curve e. ATC falls, its economic profit falls, and it faces a less elastic demand curve