A firm's total cost divided by its level of output is equal to its:
A. average total cost.
B. marginal cost.
C. variable cost.
D. start-up cost.
Answer: A
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Relative to a situation where only a single price is charged, a seller that engages in price discrimination will
a. charge consumers with an inelastic demand a lower price. b. charge consumers with an elastic demand a higher price. c. generally produce a larger total output. d. decrease social welfare and make all consumers worse off.
Which of the following statements about economic models is correct?
a. Economic models are built to mirror reality exactly. b. Economic models are useful, but they should not be used for the purpose of improving public policies. c. Because economic models omit many details, they allow us to see what is truly important. d. Economic models seldom incorporate equations or diagrams.
Substitutes
What will be an ideal response?
? You are considering buying a store. The store owner shows you sales figures of the store on a “typical” day. The owner has most likely shown you figures for
a. The less productive day
b. The more productive day
c. Any typical day
d. All the days that the store was owned by him