Use the following graph for a perfectly competitive firm generating a loss in the short run to answer the next question.
Which of the following market changes would allow the firm to earn an economic profit?
A. an increase in the number of firms entering the industry
B. a decrease in market demand
C. a decrease in the price of the industry's product
D. an increase in market demand
Answer: D
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Indifference curves intersect at the point of utility maximization
Indicate whether the statement is true or false
Why would a firm knowingly hire lazy employees?
A) Lazy employees have positive marginal revenue product. B) Lazy employees have successfully sued firms in the past. C) The Americans with Disabilities Act mandates that laziness be considered a disability. D) Lazy employees make hard-working employees look good.
A brand name may contribute to oligopolists' economic profit by
a. shifting the demand curve leftward b. shifting the supply curve leftward c. overcoming economies of scale d. acting as a barrier to entry e. reducing advertising costs
Domestic savings:
A. is equal to domestic income minus consumption spending. B. comes from private households spending less than they earn. C. occurs when government revenues exceed noncapital expenditures. D. All of these are true.