Which of the following conditions hold true for both the perfectly competitive firm and the monopoly at the profit-maximizing output level?
A) MR = P
B) MC = ATC
C) MC = P
D) MR = MC
D
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In the United States, runs on banks are prevented because
A) banks are forbidden to make unprofitable loans. B) banks have the option of denying depositors access to their funds. C) the government guarantees bank accounts for up to $250,000. D) banks keep 100 percent of their deposits on hand.
The above figure shows the market for blouses. The government decides to impose the sales tax on sellers, as shown in the figure. How much producer surplus is lost?
A) $10,000 B) $20,000 C) $25,000 D) $40,000
A fall in the price of the final product produced by a firm will cause
A. a reduction in demand for an input used to produce the final product. B. a reduction in the supply of an input used to produce the final product. C. a movement down the demand curve for an input used to produce the final product. D. a decline in the price of an input used to produce the good.
Gains from trade will be possible as long as
A) people have different endowments. B) people place different values on some goods. C) marginal rates of substitution are equal across individuals. D) excess supply equals excess demand.