The vertical distance between a firm's total cost curve and its total variable cost curve
a. is zero
b. is negative when the firm incurs fixed costs in the short run
c. represents total fixed costs
d. represents marginal costs
e. represents average fixed costs
C
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In the above figure, CBL is the cost of breaking the law. If it is illegal to buy, but not illegal to sell, then the price per unit will be
A) $500. B) $400. C) $300. D) $200.
Suppose that on a Saturday night at 10 pm, a large hotel has 300 vacant rooms, with little expectation of renting them at such a late hour on a weekend. A traveler comes in the door, looking a bit down on his luck, and asks how much a room will cost. Since he can’t afford the normal rate of $150, the night manager decides to let him stay in the room for only $40. Is it likely that this decision reduced, or increased, the hotel’s profits? Explain your answer.
What will be an ideal response?
GDP could be calculated over:
A. a month. B. a quarter. C. a year. D. any time period.
One way the government can introduce competition into a monopoly industry is to:
A. split it vertically. B. break up the company along different stages of the production process. C. split it horizontally. D. All of these statements are true.