Under perfect competition, regarding short-run profit, a firm may find itself losing money. This is true because
A. the firm was unable to pick the output that maximized profit.
B. the market conditions make the highest possible profit a negative number.
C. the demand for its product is strong.
D. the firm could not produce enough output to make a profit.
Answer: B
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The crowding-out effect refers to the possibility that an
a. increase in the money supply will result in a decline in taxes. b. increase in consumption spending will crowd out government spending. c. increase in private savings will crowd out the taxable income of households. d. increase in government borrowing will result in higher interest rates, which will crowd out private investment and consumption.
According to the aggregate demand and aggregate supply model, in the long run a decrease in the money supply leads to
a. decreases in both the price level and real GDP. b. an increase in real GDP and an increase in the price level. c. a decrease in the price level but does not change real GDP. d. an increase in the price level but does not change real GDP.
Last year Christine worked as a consultant. She hired an administrative assistant for $15,000 per year and rented office space (utilities included) for $3,000 per month. Her total revenue for the year was $100,000. If Christine hadn't worked as a consultant, she would have worked at a real estate firm earning $40,000 a year.Last year, Christine's accounting profit was ________ and her economic profit was ________.
A. $49,000; $9,000 B. $9,000; 0 C. $100,000; $64,000 D. $64,000; $49,000
A fixed exchange rate may be changed at some point over time.
Answer the following statement true (T) or false (F)