Figure 8.1 depicts demand and costs for a monopolistically competitive firm. At the profit-maximizing output level:
A. this firm is earning economic profits equal to zero.
B. this firm is earning economic profits equal to Q1(P1 - AC1).
C. this firm is earning economic profits equal to P1(Q1 - AC1).
D. this firm is in long-run equilibrium.
Answer: B
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Which of the following statements is false?
A) Economic costs include the opportunity costs of the resources owned by the firm. B) Accounting costs typically include only explicit costs. C) Economic profit will always be less than accounting profit if resources owned and used by the firm have any opportunity costs. D) Accounting profit is equal to total revenue minus implicit costs.
When people "vote with their feet" they _____
a. move to the governmental jurisdiction with the lowest taxes b. move to the governmental jurisdiction that have the bundle of government goods and services closest to their preferred level c. move to the governmental jurisdiction with the best schools d. move to democracies from dictatorships
A net capital inflow occurs in open economies where investment is:
A. higher than national savings. B. lower than national savings. C. equal to national savings. D. higher than national spending.
Dividing the change in total revenue by the change in labor gives:
A. marginal product of labor. B. marginal revenue product of labor. C. the price of the output. D. demand for the output.