If a competitive firm’s short-run average cost curve lies above the price of the product, we can conclude that the firm

A. is earning a huge profit.
B. is incurring losses.
C. is earning zero economic profits.
D. is earning a normal profit.


Answer: B

Economics

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Suppose that real GDP grows at 3 percent per year. What is the growth rate of real GDP per person if the population grows at:

a. 2 percent? What happens to the standard of living? b. 3 percent? What happens to the standard of living? c. 4 percent? What happens to the standard of living?

Economics

A firm experiences ________ when its ________ downward as output increases

A) diseconomies of scale; average total cost curve slopes B) economies of scale; long-run average cost curve slopes C) diminishing marginal returns; long-run average cost curve slopes D) diminishing marginal returns; average total cost curve shifts

Economics

Rising unemployment and decreased business confidence could be signs that the economy is at the start of a(n):

A. recession. B. boom. C. recovery. D. expansion.

Economics

Tasha is undecided about whether to sell her house or not. If the real estate agent comes to her with a $150,000 offer, she will not sell. If the offer is $175,000 . she will sell. Think of Tasha as one of hundreds of would-be sellers on the housing market. It illustrates that

a. the demand for real estate is unreliable b. Tasha's decision making reflects a market-day supply c. there must be an excess supply of homes d. the supply curve for homes is upward sloping e. the supply curve for homes is downward sloping

Economics