A firm's break-even price is the price that is just equal to the minimum point of the AVC curve, in the short run
a. True
b. False
Indicate whether the statement is true or false
False
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The above figure shows the apartment market in Big City. What could the Big City Housing Authority do if it wants to reduce the rents paid by its citizens?
A) impose a rent floor above $1350 B) impose a rent floor below $1350 C) impose a rent ceiling above $1350 D) impose a rent ceiling below $1350
Economic profit is
A) equal to the firm's total revenue minus its opportunity costs. B) an opportunity cost of operating the firm. C) equal to the firm's total revenue minus its normal profit. D) the average return for supplying entrepreneurial ability.
The above figure shows the demand and cost curves for a firm. The figure shows a
A) monopolistically competitive firm in the long run. B) perfectly competitive firm earning zero profit. C) monopolistically competitive firm in the short run. D) perfectly competitive firm in the short run.
Suppose you came across the following headline in a story of a daily newspaper: "Automobile prices are so high right now that there must be a shortage. As a consequence not everyone who needs an automobile will be able to buy one"
Is this statement necessarily correct?