For a firm in a perfectly competitive market, price is
A) equal to both average revenue and marginal revenue.
B) equal to average revenue but greater than marginal revenue.
C) greater than marginal revenue but less than average revenue.
D) less than both average revenue and marginal revenue.
Answer: A
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The perfectly competitive firm’s short-run shutdown rule is to shut down immediately if
A. TR < TC. B. TR < SRFC. C. TR < SRVC. D. TR < MC > Q.
The opportunity cost of holding money is measured by the:
a. interest rate b. liquidity lost by holding money. c. money supply curve. d. inflation rate. e. cost of cashing in financial assets.
Recall the Application about the decrease in taxes on cigarettes in several Canadian provinces in 1994 to answer the following question(s). According to this Application, after the government deceased cigarette taxes in several Canadian provinces in 1994, the decrease in the price of cigarettes in these provinces :
A. more than doubled the smoking rate. B. created no noticeable change in the smoking rate. C. increased the smoking rate by roughly 17 percent. D. was accompanied by a slight decrease in the rate of smoking.
In the short term, a decrease in taxes will have what effect on GDP and unemployment?
A. It will reduce unemployment and reduce GDP. B. It will raise unemployment and reduce GDP. C. It will reduce unemployment and raise GDP. D. It will raise unemployment and raise GDP.