In the short run, a firm should shut down when
A) P < AVC.
B) P > MC.
C) MR > MC.
D) MR = ATC.
Answer: A
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Hyperinflation refers to a situation in which:
a. prices are rising extremely rapidly. b. prices are falling extremely rapidly. c. the price level is extremely high. d. the price level is extremely low.
The rationale behind patents is that if inventors and artists cannot secure the returns from successful projects, fewer new inventions and works of art will be produced
Indicate whether the statement is true or false
Other things equal, in an open economy, monetary policy to offset an inflationary gap will tend to
a. Lower the exchange value of the dollar and lower net exports. b. Lower the exchange value of the dollar and raise net exports. c. Raise the exchange value of the dollar and lower net exports. d. Raise the exchange value of the dollar and raise net exports.
If a change in investment spending is due to a change in the price level, then the aggregate demand curve will shift
a. True b. False