Regarding the relationship between marginal profit and average profit, which of the following statements is NOT true?
A. If the average profit is rising, the marginal profit figure must be rising.
B. If marginal profit is lower than average profit, then average profit must decrease when profit increases.
C. If marginal profit is below average profit, the average profit decreases.
D. All of these statements are true.
Answer: A
You might also like to view...
Compared to the demand for coffee, the market demand for French Roast coffee is likely to be
A. more elastic. B. more inelastic. C. perfectly elastic. D. perfectly inelastic.
Consider a monopolist with linear (inverse) demand p = a - bQ and constant average and marginal cost, c. Derive the monopolist's profit and the deadweight loss generated
Show that in such cases of linear demand and constant average and marginal cost, the deadweight loss is 50% of the monopolist's profits.
In 2010 the federal government reduced the Social Security tax withholding rate from 12.4 percent (6.2 percent on both the employer and employee) to 8.4 percent (4.2 percent on both the employer and employee) on the wages of all workers. If the supply of labor is relatively inelastic when compared to the elasticity of the demand for labor, the burden of this tax will
a. continue to fall primarily on employees. b. continue to fall primarily on employers. c. be divided equally between employees and employers. d. change from primarily falling on employees to employers.
Answer the following statement(s) true (T) or false (F)
1. Public choice economists feel that government activities are the result of individual behaviors. 2. Competition has been eliminated from the public sector. 3. The individual consumption–payment link is created by majority rule. 4. Most voters are extremely liberal or extremely conservative. 5. Ideally, voters in a democracy should know about the candidates and the issues.