Answer the following statement(s) true (T) or false (F)
1. When a competitive firm earns zero profit, the market price is equal to both the firm's average and marginal costs.
2. In a competitive constant-cost industry, all firms have the same break-even price.
3. A government subsidy would allow all firms in a competitive constant-cost industry to earn a positive profit in the long run.
4. Sunk costs cannot affect a firm's short-run supply, but they can affect its long-run decision to exit the industry.
5. If the market price is currently above the shut-down price, the firm will be making positive profits.
1. True
2. True
3. False
4. False
5. False
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According to Brinley Thomas, the inflows of immigrants to the U.S. in the late-19th and early 20th centuries
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A problem that the Fed faces when it attempts to control the money supply is that
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Graphically the intersection of the aggregate demand curve and the short-run aggregate supply line determines:
A. long-run equilibrium. B. exogenous spending. C. potential output. D. short-run equilibrium.