Which of the following holds true at the chosen level of output in the long run for firms in a perfectly competitive market?
A. MR = AVC
B. P = minimum AVC
C. P = MC
D. MR > ATC
Answer: C
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If the British government fixes the exchange rate for its currency (the pound) below market equilibrium, it will contribute to a positive balance on current account
Indicate whether the statement is true or false
One of the results of the strong economic growth in the United States relative to the rest of the world is a
a. U.S. trade surplus. b. U.S. trade deficit. c. growing U.S. net exports. d. trade deficit for U.S. trading partners.
The higher the nominal interest rate:
A. the less money individuals will hold for any given level of transactions and the higher the velocity of money. B. the less money individuals will hold for any given level of transactions and the lower the velocity of money. C. the more money individuals will hold for any given level of transactions and the lower the velocity of money. D. the more money individuals will hold for any given level of transactions and the higher the velocity of money.
The decisions of buyers and sellers that affect people who are not participants in the market create
a. market power. b. externalities. c. profiteering. d. market equilibrium.