"In the short run, a firm cannot change any of its inputs." Do you agree or disagree? Explain
What will be an ideal response?
Disagree. The short run is a period that is so short that the firm cannot change at least one of its inputs. In other words, it can still change other inputs, known as variable inputs.
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For a perfectly competitive firm facing the short-run break-even price
A) it has a negative accounting profit. B) it has an economic profit of zero. C) it should shut down. D) it should expand production.
Which of the following is NOT an inference of the rational expectations hypothesis?
A) Government policy actions have no real effects in the short run unless the actions are unanticipated. B) Government policy actions have no real effects in the long run. C) Government policy actions that are anticipated have no real effects in the short run. D) Government policy actions that are unanticipated have no monetary effects in the short run.
In a market economy, the decisions about what to produce and how much of each good or service to produce are made by
a. government officials. b. economic planners. c. central bankers. d. consumers and producers.
Economists are skeptical that discrimination is employer driven because
a. discrimination cannot exist in markets. b. employers are not really interested in maximizing profit. c. employers typically base wages paid on the prevailing market wage. d. holding productivity constant, a profit-maximizing employer will hire the cheapest labor available.