Refer to the graph shown. What level of output should the perfectly competitive firm produce to maximize profits?
A. 6.
B. 4.
C. 7.
D. 8.
Answer: D
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Pure economic profit must be at a maximum for a monopolist who has a level of output in which total revenue is at a maximum
a. True b. False Indicate whether the statement is true or false
In the macroeconomy, demand-side shifts change:
A. only the price level in the long run, while output eventually returns to its long-run potential level. B. only the output level in the long run, while prices eventually return to their long-run potential levels. C. aggregate demand only, which eventually shifts back in the long run. D. aggregate demand only, which is why the price level remains unaffected in the long run.
Suppose that Alan, Annie, Amanda, Alicia, and Anthony begin with the same MPC. According to Keynes's absolute income hypothesis, who ends up with the highest MPC?
a. Alicia, an attorney who earns $200,000 per year as a corporate tax specialist b. Annie, a college student living on $5,000 of student loans c. Alan, a new college graduate earning $24,000 in his first job d. Amanda, a fifty-year-old CEO earning $133,000 e. Anthony, a twenty-two-year-old rap star earning $3 million
When a tariff is imposed, a deadweight loss occurs because of: a. a loss in producer surplus
b. a fall in the price of the imported good. c. an increase in the supply of the good. d. a loss in total surplus.