If firms are producing at a profit-maximizing level of output where the price exceeds the average total cost:
A. accounting profits must be negative.
B. economic profits must be zero.
C. other firms will enter the market.
D. firms will exit the market.
C. other firms will enter the market.
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Over the last 100 years in the United States, unemployment reached its highest rate
A) in the 1920s. B) in the 1930s. C) in the 1980s. D) in the 1970s.
A commercial bank like Comerica creates money by
A) making loans. B) selling corporate bonds. C) earning profits. D) printing paper money.
A positive cross price elasticity of demand between two goods suggests that the goods are
A) not related. B) complements. C) substitutes. D) both of unitary elasticity.
A 50 percent tax on the profits of a monopolist will
a. be totally shifted to the consumer. b. raise price and lower quantity. c. cause no change in profit-maximizing price and quantity. d. change price but not quantity.