Referring to Figure 8.6, how much economic profit does the monopolistically competitive firm earn in long-run equilibrium?
What will be an ideal response?
As illustrated on the graph, the firm earns zero economic profit in long-run equilibrium. At the quantity Q the price P is just equal to long-run average cost. The firm earns just enough to stay in business.
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The figure above shows the marginal benefit and marginal cost curves for pizza. In the figure, what is the efficient quantity of pizza?
A) 0 pizzas B) 10,000 pizzas C) 20,000 pizzas D) 30,000 pizzas E) The efficient quantity cannot be determine without more information.
An observer of the economy notices that over the past 12 months the unemployment rate has fallen from 7.0 percent to 6.5 percent. During the same time, the rate of growth in real GDP has been positive. From this information we might conclude that
A) inflation is not occurring. B) an expansion is occurring in the economy. C) a recession is in progress. D) a trough in the business cycle will soon be reached.
Suppose the inverse supply curve in a market is Q = 6p2. What is the producer surplus when price is equal to 4?
A) 96 B) 128 C) 28 D) 48
Martha did not like her job as a receptionist, so she quit and is looking for one that better suits her artistic talents. Ting Pei would like to work, but employers are not willing to hire him because he does not speak English. Martha is ________ unemployed and Ting Pei is ________ unemployed.
A. frictionally; structurally B. structurally; cyclically C. cyclically; structurally D. structurally; frictionally