The primary objective of an imperfectly competitive firm is to:
A. maximize total revenue.
B. charge the highest possible price.
C. minimize total cost.
D. maximize profit.
Answer: D
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If the wage is below the marginal revenue product, then a profit-maximizing firm will
a. employ more workers b. employ fewer workers c. see an increase in its demand for labor d. see an increase in its supply of labor e. see a fall in its demand for labor
When a total output curve is falling, its corresponding marginal product curve is:
a. vertical. b. horizontal. c. rising. d. falling.
The total of all planned real expenditures in the economy is called
A. aggregate consumption. B. aggregate GDP. C. aggregate spending. D. aggregate demand.
When a product is taxed,
A) part of the initial consumer surplus goes to the government as revenue. B) part of the initial consumer surplus becomes a deadweight loss. C) the producer surplus never changes because consumers pay taxes, not producers. D) Both answers A and B are correct. E) Both answers B and C are correct.